Irsa Investments & Representations Inc – ‘6-K’ for 11/30/02

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Report of a Foreign Private Issuer   —   Form 6-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 6-K         Report of a Foreign Private Issuer                   163    784K 

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SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13A-16 OR 15B-16 OF
 THE SECURITIES EXCHANGE ACT OF 1934

 For the month of November, 2002

IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA
(Exact name of Registrant as specified in its charter)

 IRSA INVESTMENTS AND REPRESENTATIONS INC.
 (Translation of registrant's name into English)

 REPUBLIC OF ARGENTINA
 (Jurisdiction of incorporation or organization)

 BOLIVAR 108
(C1066AAB)
 BUENOS AIRES, ARGENTINA
(Address of principal executive offices)

Form 20-F X      Form 40-F    
        ---              ---

               Indicate by check mark whether the registrant by furnishing
the information contained in this Form is also thereby furnishing the           
information to the Commission pursuant to Rule 12g3-2(b) under the Securities   
Exchange Act of 1934.                                                           

   Yes         No  X
       ---         ---

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA
 (THE "COMPANY")

REPORT ON FORM 6-K

        Attached is an English translation of the following documents filed by
the Company with the Bolsa de Comercio de Buenos Aires and the Comision Nacional
de Valores: (i) Letter dated November 6, 2002 related to certain items of the   
agenda of the Annual General and Special Meeting of Shareholders held on        
November 5, 2002; (ii) Summary of the Annual General and Special Meeting of     
Shareholders held on November 5, 2002; (iii) Annual Report and Financial        
Statements as at June 30, 2002.                                                 

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(i) By letter dated November 6, 2002 the Company informed that the agenda of the
Annual General and Special Meeting of Shareholders held on November 5, 2002     
included the Consideration of the allocation of portfolio company stocks        
(distribution among the shareholders of 4,587,285 shares of the Company         
proportionally to their shareholdings). . In addition, it was resolved to       
suspend, pursuant to Resolution 402/02 of the Comision Nacional de Valores , the
treatment of the thirteenth point of the agenda (Appointment of a Company       
Accountant to certify during the next fiscal year and determination of his/her  
compensation) until November 27, 2002 at 13.00 hs at Bolivar street, first      
floor.                                                                          

(ii)                                                                            
SUMMARY OF THE ANNUAL GENERAL AND SPECIAL MEETING OF
 SHAREHOLDERS HELD ON NOVEMBER 5, 2002

FIRST POINT:                                                                    
It was unanimously approved the designation of the representatives of the       
shareholders Templeton Foreign Fund and Cresud SACIF y A to approve and sign the
minute of the meeting.-                                                         

SECOND POINT:                                                                   
It was unanimously approved the reasons causing this meeting to be called at a  
different date than the one scheduled that were previously informed by the Board
of Directors.                                                                   

THIRD POINT:                                                                    
It was unanimously decided to approved the documentation required by Section    
234, paragraph 1(st) of Law 19 550, for the fiscal year ended June 30th, 2002.  

FOURTH POINT:                                                                   
It was unanimously decided to approved the performance of duties by the Board of
Directors related to the fiscal year ended on June 30, 2002                     

FIFTH POINT:                                                                    
It was unanimously decided to approved the performance of duties by the Audit   
Committee related to the fiscal year ended on June 30, 2002                     

SIXTH POINT:                                                                    
It was unanimously decided to apply the loss of the fiscal year ended on June   
30, 2002 of Pesos 499,619,000 to the account Retained Earnings.                 

SEVENTH POINT                                                                   
It was unanimously approved the distribution among the shareholders of 4,587,285
shares of the Company proportionally to their shareholdings.                    

EIGHTH POINT:                                                                   
It was unanimously approved the amount of Pesos 979,885 as Directors'           
Compensation.                                                                   

NINTH POINT                                                                     
It was unanimously decided to approve the resignation to their compensation made
by the Audit Committee.                                                         

TENTH POINT:                                                                    

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It was unanimously decided to approve the resignations submitted by Messrs.     
Emilio Cardenas, Enrique Antonini, Gary Gladstein and Jeremiah W.O'Connor.      

ELEVENTH POINT:                                                                 
It was unanimously decided: (i) To fix the number of regular directors in eight;
(ii) to appoint Fernando Adrian Elsztain and Aaron Gabriel Juejati as regular   
director for a three year period; (iii) to appoint Juan Carlos Quintana Teran,  
Salvador Dario Bergel and Gabriel Adolfo Gregorio Rieznikas as alternate        
directors. All of them are considered non independent in terms of Resolution 400
of the Comision Nacional de Valores.                                            

TWELFTH POINT                                                                   
It was unanimously decided to appoint Jose Daniel Abelovich, Carlos Martin      
Barbafina and Marcelo Hector Fuxman as regular auditors and Corina Ines Pando,  
Diego Niebuhr and Carlos Rebay as alternate auditors.                           

THIRTEENTH POINT:                                                               
It was decided to suspend, pursuant to Resolution 402/02 of the Comision        
Nacional de Valores , the treatment of this point of the agenda (Appointment of 
a Company Accountant to certify during the next fiscal year and determination of
his/her compensation) until November 27, 2002 at 13.00 hs at Bolivar street 108,
first floor.                                                                    

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 [IRSA LOGO]

Inversiones y Representaciones
Sociedad Anonima

 Board Report and Financial Statements
 -------------------------------------
 For the year ended June 30, 2002 and 2001

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INDEX                                                               PAGE        
------------------------------------------------------------------------        

CORPORATE PROFILE .....................................................3        

LETTER TO THE SHAREHOLDERS ............................................4        

ECONOMIC OVERVIEW ....................................................11        

DESCRIPTION OF OPERATIONS ............................................15        

SUBSEQUENT EVENTS ....................................................39        

SELECTED CONSOLIDATED FINANCIAL AND OPERATING INFORMATION ............40        

MANAGEMENT ...........................................................61        

STOCK MARKET INFORMATION .............................................67        

FINANCIAL STATEMENTS .................................................69        

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 CORPORATE PROFILE

       Founded IN 1943, IRSA Inversiones y Representaciones S.A. ("IRSA" or "the
Company") is the largest Argentine real estate investment company and the only  
Argentine real estate company listed on the Buenos Aires Stock Exchange (the    
"BASE") and on the New York Stock Exchange.                                     

      IRSA is the best vehicle through which to gain access to the real estate
market in Argentina because of its achievements to date, its significant and    
diversified portfolio of properties that ensure it is the leader in almost all  
those sectors in which it has participated and because of the capability and    
strength of its Management team in taking advantage of opportunities and        
maximizing the value of the Company and shareholder return.                     

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LETTER TO THE SHAREHOLDERS

To the Shareholders:                                              

    At the end of the twelve months corresponding to the fiscal year ended
June 30, 2002, we would like to bring to your attention the results obtained by 
the Company and comment on the development of the business.                     

      The first six months of 2002 were among the most dramatic in the history
of Argentina. The domestic economy went into a free fall following the collapse 
of the financial system and the absence of clear rules on which to carry our    
business.                                                                       

The lack of measures to define the new monetary system that was to
replace Convertibility led to a devaluation that by the end of the focal year   
had increased the price of the US dollar by 280%. The rise in consumer prices   
during the first six months of the year was of 30.5%, while wholesale prices    
went up 95.6% in the same period.                                               

     These conditions led a significant number of leading companies in the
private sector to declare their inability to meet their financial liabilities,  
emulating the default on sovereign debt announced by the Argentine Government in
the closing days of 2001.                                                       

    The crisis in Argentina spread throughout the region, with Uruguay and
Brazil being the most affected. In July an acceleration in the outflow of       
deposits from the Uruguayan financial system, which reached 45% of the total    
during the first seven months of the year, led to the resignation of the        
country's economy minister, the devaluation of its currency and the rescheduling
over the next three years of the return of time deposits by state banks. In     
Brazil, the political uncertainty generated by the upcoming presidential        
elections aggravated the already poor performance of the economy. These two     
factors encouraged the presumption that the country could fail to meet payments 
due on its public sector debt, pushing up the country risk rate to 2,422 basis  
points and the rate of devaluation of the real, which reached 30.5% during 2002.

    For our Company, the fiscal year ended June 30, 2002, showed a loss of
Ps.499.6 million. Among the relevant factors determining the negative net result
reached, we can mention the financing effects which presented a net loss of     
Ps.432.2 million. In the composition of the mentioned line of our income        
statement, it is worth noting the loss due to the net exchange rate difference  
which at the end of this fiscal year came up to Ps.255.1 million and the result 
generated by the effects of inflation showing a net loss of Ps.53.1 million. The
whole of our operations were affected by the deep deterioration of the          
macroeconomic conditions of the domestic market, recording a loss of Ps.46.9    
million at the operating result level. In its composition, what stands out is a 
loss due to the holding of real estate assets of Ps.96.8 million, as a          
consequence of the recognition of the writing down of certain real estate       
properties.                                                                     

The value of the assets of our Company has been affected by the   
deterioration of relative prices. We consider that as soon as the level of      
activity shows some signs of recovery, there will be a generalized              
re-composition of our assets.                                                   

Sales decreased to Ps.211.3 million, which implies a fall by 37.8%
compared to the previous fiscal year. Total assets declined by 23.4% compared to
the previous fiscal year, reaching Ps.1,144.7 million and the net financial debt
went up by 50%, totaling Ps.564.9 million as of June 30, 2002. The above        
mentioned increase is a result of the impact of the devaluation over our        
financial liabilities in dollars, which means that the said liabilities grew, if
measured in Pesos, around 280% as of the end of this fiscal year.               

    In the light of this scenario of generalized default and corporate net
worths dilution, our Company fulfilled all of its obligations and made the most 
of the financial tools available in the market so as to cancel all of its       
pesified financial liabilities by the acquisition of rescheduled certificates of
bank deposit. The strategy                                                      

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implemented allowed us to obtain important discounts in the repayment of        
liabilities, thus reducing high financial costs.                                

      The Sales and  Development  and Hotels  segments were the most adversely
affected by the drop in economic activity levels. The share of sales accounted  
for by the various segments was as follows: Sales and Developments Ps. 45.2     
million, Offices and Others Ps. 34.3 million, Shopping Centers Ps. 77.6 million,
Hotels Ps. 29.5 million and International Ps. 24.8 million. Operating income for
the year totaled Ps. (46.9), representing a fall of Ps. 124.0 million as        
compared to the previous fiscal year.                                           

SHOPPING CENTERS                                                  

ALTO PALERMO S. A. (APSA)                                                       

    The current situation has had an undoubted impact on the operations of
Alto Palermo S.A. (APSA) ("APSA") causing a net loss for the current year of Ps.
42.2 million, mainly as a result of the increase in the financial burden from   
the disproportionate increase in interest rates, the effect of the devaluation  
and lower revenues from the drop in consumer spending, a fundamental variable   
for the business.                                                               

    The operating cost reduction process which begun in previous years and
continued in the current fiscal year has meant that the structure of the Company
is in line with business levels, ensuring that results were not further         
affected.                                                                       

       Throughout the year commercial activities were carried out with a view to
the long term, supporting lease-holders in the difficult times the country is   
experiencing, particularly during those months in which the Argentine economy   
was virtually paralyzed.                                                        

    During fiscal year 2002 APSA's shopping centers suffered a significant
decrease in consumption that translated to a reduction of sales of 19.4%        
compared to last year. In the light of the recessive economic situation, this   
segment adopted aggressive promotional activities in order to increase internal 
consumption and attract tourism, a new segment generated by the attractiveness  
of local proposals and the benefits that come together with the new devaluation 
context. In this way, during the last months the segment managed to revert a    
downward trend that had been going on for more than three years. In the last    
months of the periods the shopping center segment obtained higher figures than  
the ones obtained for the same months of fiscal year 2001.                      

      APSA suffered a drop in collections in the early months of the year that
affected the bad debt allowance in relation to its shopping centers, with an    
increase of Ps. 19.3 million compared to the previous year. However, since March
a recovery has been noted in this variable, with collection levels higher than  
billing.                                                                        

     The property sale area has celebrated the conclusion of the sale of the
Torres de Abasto, one of the most successful recent real estate developments.   

    The Tarjeta Shopping credit card suffered from the prevailing context,
being responsible for a loss of Ps. 10.1 million for the year. In view of this  
situation, APSA altered its strategy, aiming to create increased loyalty among  
clients by offering a varied commercial proposal, with new financial products   
which will have a growing impact on the results of the coming year.             

     Two years after the launch of Altocity.Com, a retail e-commerce company
in which APSA holds a 50% interest, it has succeeded in consolidating its       
position as one of the leaders of this type of sales channel, becoming well     
established in consumer preference.                                             

       Regarding its financial situation, last year APSA intended to be aware of
the opportunities presented in the market with the aim to reduce its financial  
costs. It is so that APSA turned up to be the first Argentine company to return 
to the capital market, launching the first branch of convertible notes for US$  
50,0 million. Today APSA is proud to inform that the convertible notes have been
completely subscribed and integrated. This                                      

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offering allows APSA to restructure its financial debt, be able to fulfill its  
short-term obligations and maintain an adequate capital structure.              

      In a context of devaluation and widespread default, when first the State
and then a large number of private companies declared their inability to meet   
their obligations, APSA is proud to have succeeded in complying with its        
liabilities on their due dates.                                                 

 APSA is aware that the effort it makes today will bear fruit in the
future, and that its exertions to comply with its commitments will become one of
its main assets tomorrow. When markets look back on the behaviour of companies  
at a time when it was easy to be just one more company throwing the towel, APSA 
will possess an incomparable competitive advantage as a result of its notable   
attitude.                                                                       

     APSA is aware of the difficult task before it as a new fiscal year gets
under way, but is fully confident of the Company's potential and the success of 
the steps that have been taken during the current year, which will ensue it will
emerge from the crisis as a sound business with strong growth potential. It is  
to be hoped that the signs of improvement seen towards the end of the fiscal    
year on the business variables will be consolidated, reversing the negative     
trend of recent years.                                                          

OFFICES AND OTHERS                                                

      During the year ended June 30, 2002 income from rental properties totals
Ps. 34.3 million compared to Ps. 45.6 in the same period of fiscal year 2001.   
Average occupancy fell from 89% at June 30, 2002 to 72% at June 30 2002. This   
drop has been due to the severe economic recession that has forced certain      
companies to relocate their plants or move to lower rent areas, such as Aguas   
Argentinas, which did not renew its contract for the premises at Reconquista    
823, leaving them vacant. In addition, Decree 214 dated February 4, 2002        
established the conversion into pesos of contracts in dollars at the rate of    
US$1= $1 and the index-linking of contracts in force according to the CER       
coefficient. In the case of new contracts, this coefficient cannot be applied,  
making it difficult to enter into any new rental agreements.                    

    During the year just ended, the Company continued with the disposal of
some of its non-strategic rental properties.                                    

     SALE OF RIVADAVIA 2243. On January 31, 2002 the Company sold one of its
commercial properties located at Avenida Rivadavia 2243 to the Tia supermarket  
chain. For the sale of this property with a floor area of 2,070 m2 the Company  
received a total of US$ 0.9 million and Ps. 1.0 million. This property had a    
book value of Ps. 3.7 million.                                                  

    SALE OF LIBERTADOR 498 OFFICES - On April 12 and 16, 2002, the Company
sold two of its building floors located in the Libertador 498 office building   
tower. The price paid for the sale of floor 5 amounted to Ps.1,195,000 and      
Ps.1,450,400 for floor 7.                                                       

       SALE OF DOCK 5 UNITS - On May 15 and 16, 2002, the Company sold units 141
and 156 located in Dock 5 for US$ 87,000 and Ps.276,375, respectively. On June  
21, 2002 it completed the sale of unit 155 located in the same building for a   
total amount of US$ 133,555.56, US$ 55,555.56 of which have already been        
received by the Company. The remaining US$ 78,000 shall be paid in 12           
installments without interest, starting on July 14, 2002. On August 20, 2002    
unit 140 was sold for a total amount of US$ 110,000.                            

SALES AND DEVELOPMENTS                                            

The Sales and Developments, was one of the segments most severely 
affected by the recession. Income earned by this segment fell to Ps. 45.2       
million at June 30, 2002, compared to Ps. 89.8 at June 30, 2001. This reduction 
has mainly been due to the limited stock of units for sale that the Company can 
currently count on, as a result of the interruption several quarters previously 
of new development launches, because of the severe recession and the consequent 
fall in demand.                                                                 

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    SALE OF PROPERTIES AGAINST TIME DEPOSITS. To stimulate property sales,
the Company has actively promoted the sales against rescheduled time deposit    
certificates. Under this mechanism, in effect until April 15, 2002, sales were  
made for a total of Ps. 9.6 million. Eleven units were sold in the Alto Palermo 
Park building for a total of Ps. 6.2 million, as well as two floors in the "El  
Rulero" office building (Libertador 498) for a total of Ps. 2.6 million. This   
operations enabled purchasers to make use of their funds that had been          
immobilized within the financial system, while the Company was able to sell     
property at higher values, with the proceeds being credited to sight accounts.  

       SALE OF MINETTI D UNITS - On April 26, 2002 and May 10, 2002, the Company
sold two of its lofts in the building Minetti D. For this sale the Company      
received Ps.100,000 and Ps.78,000, respectively. During May 2002 the sale of one
of the Company's car-ports in the same building took place for a total of Ps.   
8,000                                                                           

     ABRIL, HUDSON, PROVINCIA DE BUENOS AIRES. At the end of the fiscal year
2002, 19 of the 20 neighbourhoods projected for all the development were being  
marketed, 85% of the lots in such neighbourhoods had been sold. There were 98   
houses under construction, 412 finished houses and 61 new projects has been     
submitted. It should be noted that 450 families are already living in this      
development and 530 regularly children attend the bilingual school opened in    
March 1999.                                                                     

HOTELS                                                            

  The hotel business has been significantly affected by current market
conditions. Income for this segment was down by approximately 27.9%, reaching   
Ps. 29.5 million. Average occupancy levels continued to fall because of the     
profound domestic crisis. Average room rates measured in Pesos recovered        
slightly compared to the previous year as they were set in dollars. We consider 
that the current rate of exchange will have a positive influence on the segment,
promoting the growth of regional tourism.                                       

INTERNATIONAL                                                     

      SALE OF BRAZIL REALTY - On February 28, 2002, Ritelco S.A., a controlled
company of IRSA, sold 100% of its equity interest in Brazil Realty, subsidiary  
of the Company in Brazil. Creed Holdings LTD, purchased the entire stockholding.
The transaction's price was agreed in the amount of US$ 44.2 million. This      
transaction generated a net positive result of Ps.31.5 millions.                

This transaction represented the conclusion of our International  
activities.                                                                     

FINANCIAL POSITION                                                

       The drastic capital flight suffered by Argentina since the second half of
2001 which led the financial system to the edge of collapse, added to economic  
policy errors in the first half of 2002, altered the domestic financial market  
in most unexpected ways. The measures ordered by the economic authorities, the  
conversion into pesos of the loans initially granted in dollars on the domestic 
market and their restatement according to an index based in changes in consumer 
prices, the freeing of the exchange rate and other measures affecting the normal
development of the monetary system led a significant number of companies to     
default on their debt. In this context, the financial area of our Company       
concentrated on making use of all available opportunities to reduce the         
Company's financial debt. This strategy, in addition to ensuring we complied    
with our debt commitments, has enabled us to obtain significant discounts in the
settlement of liabilities, lowering high financial costs.                       

       Conversion of Debt into Pesos. On the repeal of the Convertibility Law on
February 4, 2002, all liabilities denominated in us dollars payable to the      
Argentine banking system and subject to Argentine law were forcibly converted   
into Peso-denominated liabilities at the rate of one Peso per US dollar.        
However, a significant part of the Company's liabilities are subject to the laws
of the State of New York, and were therefore not converted into Pesos.          

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       Approximately US$ 42 million of IRSA's debt was converted into Pesos, and
in the case of its shopping center subsidiary APSA, this rule converted the full
amount of its financial debt into Pesos. The debt converted to Pesos is to de   
restated according to the CER index that reflects inflation and is published on 
a daily basis. In addition, debt converted into Pesos accrues interest at a     
maximum rate of between 6% and 8%, depending on whether there are real          
guarantees for the corresponding loans.                                         

      DEBT CANCELLATION WITH RESCHEDULED BANK DEPOSITS - Between the months of
January and June 2002, the Company cancelled pesified short term debt for an    
amount of Ps.46.7 million (includes the Banco Galicia loan and Inversora Bolivar
debt) by the acquisition, via purchase from hands of depositors and via property
sales, of rescheduled deposit certificates, achieving important discounts over  
the notional value. The funds used on this purchase were mainly obtained from   
the sale of the Brazil Realty and from the Company's cash generation.           

       This procedure determined important savings on financial expenses, due to
the reduction on interests charges. On the other hand, the debt cancellation was
done at a very important discount over its original dollar value, due to the    
fact that the conversion to pesos was established at an exchange rate of one    
U.S. dollar (US$ 1) = one Peso (Ps.1) and due to the possibility of using       
rescheduled bank deposits purchased at attractive discounts.                    

IMPACT OF DEVALUATION ON THE COMPANY'S FINANCIAL POSITION - As a  
consequence of the ending of the Peso-U.S. dollar parity set forth under the    
Convertibility Law, and although part of our liabilities were pesified at the   
exchange rate Ps.1=US$ 1, those liabilities constituted under American law      
remained in U.S. dollars therefore creating an important negative result due to 
the Peso devaluation, approximately amounting to Ps.255.1 million for this      
period. These results have been recorded under "Financial Results" and partially
explain the considerable loss on this line for this period.                     

    It must be noted that the reported figures reflect distortions arising
from the significant instability of the currency. Furthermore, some items are   
subject to this adjustment while others are not, a fact which significantly     
complicate the analysis of performance and the assessment of the value of the   
Company's assets. We believe that the relative distortions will gradually       
disappear and the value of real estate assets will recover over time, hand in   
hand with the economy's general correction.                                     

     BANCO GALICIA LOAN - Renovation and payment of principal - On September
28, 2001, the Company paid the outstanding US$ 10 million balance under the US$ 
40.0 million facility granted by Banco Galicia in December 1999. On October 11, 
2001 a new US$ 7.0 million loan with a one-year maturity was granted by Banco   
Galicia. The loan accrues interest at Encuesta Corregida rate plus 500 basis    
points. In accordance with Decree 214 this loan has been pesified. In May, 2002 
our Company completely repaid this loan with rescheduled bank deposits and      
obtained an important discount over its value in pesos.                         

   FIDEICOMISO IRSA I (IRSA, IBSA AND BALDOVINOS) - SALE OF THE MORTGAGE
PORTFOLIO - On November 2, 2001, the Company entered into an agreement with     
Banco Sudameris for it to act as trustee and lead manager of Fideicomiso IRSA I.
The whole mortgage portfolio generated by the three companies mentioned above,  
which amounts approximately Ps.26.6 million, was transferred to the trust. On   
December 31, 2001, the Company received from Banco Sudameris US$ 10 million in  
terms of underwriting. In addition, between the months of January and March,    
2002 the Company received Ps.2.35 million.                                      

     SALE OF LATIN AMERICAN  ECONETWORKS N.V. - On November 7, 2001, we sold
our ownership in Latin American Econetworks for Ps. 5.2 million.                

    EXTENSION OF MATURITY OF THE US$ 43.5 MILLION NOTE - After a number of
extensions agreed upon between IRSA and the holders of the US$ 43.5 million     
Note, September 9, 2002, was established as final date of maturity of the       
principal amount. In addition, a capitalization of interest was agreed upon. On 
May 15, 2002, the Company repurchased a fraction of the notes, which resulted in
a reduction of the outstanding amount, that                                     

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by August 30, 2002, reached US$ 40.1 million. The Company and the note holders  
are studying the available alternatives for the repayment of this facility.     

      EXTENSION OF MATURITY OF THE US$ 80 MILLION SYNDICATED CREDIT FACILITY -
On July 31, 2002 the Company's US$ 80 million syndicated credit facility matured
and due to the continuing effects of the economic recession and the lack of     
available financial resources, the Company agreed with the intervening banks to 
postpone maturity until September 30, 2002. The Company expects to renegotiate  
the credit under new conditions, by that date.                                  

ISSUE OF BONDS CONVERTIBLE INTO ORDINARY SHARES OF IRSA - The     
Shareholders' Special and General Meeting of IRSA held on March 8, 2002 approved
the issuance of bonds convertible into ordinary shares of the Company of a Ps. 1
nominal value each, entitled to 1 vote, for up to US$ 100 million, with a fixed 
coupon ranging between 6% to 12% per annum, payable every six months in arrears 
and with a conversion price which will result from the average closing price for
the twenty days previous to the closing of the transaction, with a conversion   
premium of up to 10%, at the board of directors' discretion, to be determined by
the board with warrants attached that will be exercised at a conversion price   
plus an issue premium of between 20% y 30%. The proceeds of this issue will be  
used fundamentally to repay existing liabilities, working capital, and to       
underwrite, in case it happens, the second branch of the convertible bond       
offered by APSA. The Company is awaiting the relevant approvals of the          
supervisory agencies so as to implement the issue.                              

      ISSUE OF NEGOTIABLE OBLIGATIONS CONVERTIBLE INTO ORDINARY SHARES OF APSA
- The Ordinary and Extraordinary Shareholders' Special and General Meeting of   
APSA held on December 4, 2001r, approved the issuance of negotiable Obligations 
convertible into ordinary shares of APSA with a par value of Ps. 0.1 each and   
one vote per share, for up to a nominal value of US$ 100 million, accruing      
interest at a fixed rate of 10% p.a. payable six-monthly in arrears with a      
conversion price of between Ps. 0.10 and Ps. 0.15 to be determined by the board.
The funds generated by the issue will be assigned to settle liabilities existing
at that date.                                                                   

     ISSUE OF BONDS CONVERTIBLE INTO ORDINARY SHARES OF APSA - On August 20,
2002, APSA ended its subscription period for the first branch for up to US$ 50  
million of bonds convertible into ordinary shares of APSA of a Ps.0.1 nominal   
value each. In this sense, IRSA has subscribed a total amount of US$ 27.2       
million of the convertible notes of APSA. The issue of Series I was a success   
and has been fully subscribed.                                                  

    Despite the unfavourable economic and financial conditions reigning in
the Argentine market and despite the crisis in which the corporate sector is    
immersed, the Management of our Company has re-stated its commitment to stand   
out, focusing with energy and creativity on the crucial task of consolidating   
the financial situation of the Company. Furthermore, and under the same         
principle of supporting a flexible and efficient structure, we have deepened our
plan of rationalizing resources. This plan has shown a decline of 34.8% in      
administrative expenses as of June 30, 2002.                                    

       In spite of the long lasting economic crisis pervading in the country, we
are aware of the fact that human and natural resources as well as investments on
facilities performed during the last decade in Argentina remain practically     
intact. The possibility of recreating market conditions facilitating growth and 
action by the private sector, sole generator of genuine employment, shall depend
on the responsibility and efficiency of the country's leaders. Among the main   
premises to be met for the purpose of restoring the essential trust environment 
absolutely necessary to recover investment we find, in the first place, the     
country's reinsertion in the world initiating negotiations with external        
creditors. Furthermore, we must guarantee restoration of the domestic financial 
system and stabilization of macroeconomic indicators through consistent and     
precise monetary and tax policies. As was the case in previous fiscal years, we 
reassert our trust in the privileged features of Argentina's economy for prompt 
recovery. Looking forward to this moment, we state our strong commitment to     
protect our Company's asset value, maintaining our business segments growth     
potential.                                                                      

       To conclude, I would like to thank all those who have worked alongside us
throughout the year: our shareholders, bankers, tenants and clients, and in     
particular our personnel, for their support and confidence that have made this  
Company's business possible.                                                    

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                                                             Eduardo S. Elsztain

                                                             President

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 ECONOMIC OVERVIEW

INTERNATIONAL OUTLOOK                                             

      In spite of the aggressive monetary policy implemented by the US Federal
Reserve, consisting in a drastic reduction in the rate of interest from 6.50% to
1.75%, its economy did not succeed in taking off during the whole of 2001. After
the first six months during which the level of economic activity cooled         
considerably, the attacks on September 11 and the subsequent call by the US     
president for a war on terrorism had a negative impact on investor and consumer 
confidence in the United States, causing drops in all key indicators. The       
largest Western economies did not fare any better, and the Japanese economy     
remained immersed in a long lasting domestic crisis. Faced by this scenario, the
Republican administration reacted by encouraging an increase in public spending,
providing significant assistance to those sectors most affected by the crisis,  
with particularly great help given to airlines. The measures adopted were       
reflected in a significant rise in US GDP in the first quarter of 2002, but this
recovery did not last very long. This sombre outlook was compounded by the      
scandal surrounding the collapse of several blue-chip companies that were       
accused of misrepresenting their financial statements, further undermining the  
already deteriorated level of confidence of local and foreign investors. As a   
result, financial markets were severely affected, leading US stock market       
indicators suffered losses in excess of 30%, while the collapse of their        
European equivalents was even sharper.                                          

       In addition to being affected by the events mentioned, emerging economies
suffered the total loss of the voluntary credit market and had to face their own
crisis unleashed by their high levels of indebtedness. Unfortunately, the most  
notorious example of this has been that of Argentina.                           

THE ARGENTINE ECONOMY                                             

   As a result of the worsening of the recession that began in mid-1998,
during the second half of 2001 Argentina's GDP fell by an average of 5% compared
to the same period of the previous year. After a series of measures that did not
achieve the desired effect, the Economy Ministry attempted to reverse the       
recession by promoting a sharp reduction in the fiscal deficit. As a first step,
Congress approved a "Zero Deficit Law", and later by means of an emergency law a
13% reduction was decreed in civil service wages and state pensions. A few      
months later, growing financial restrictions led several provincial             
administrations, including the important province of Buenos Aires, to begin to  
print their own currency to be able to cover their growing cash deficits. The   
issue of these quasi-currencies reached a volume in excess of Ps. 8 billion.    

    On December 3, 2001, in the face of the impossibility of reversing the
massive outflow of deposits from the financial system, which between July and   
December 2001 had reached US$ 14.3 billion (16% of the total), the Economy      
Ministry issued a regulation limiting cash withdrawals from bank accounts, a    
measure that later became known as the "corralito". This step, together with the
worsening of the social situation, led to the early conclusion of the term of   
the Alianza government. This situation brought to the surface the profound      
institutional and political crisis affecting the country                        

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 [GRAPHIC OMITTED]
Source: Estudio Miguel Angel Broda y Asoc.  

    During the brief presidency of Adolfo Rodriguez Saa, which lasted only
seven days immediately prior to taking over by Dr. Eduardo Duhalde, a cessation 
of payments was declared on sovereign debt, a measure widely applauded by       
legislators when announced to Congress.                                         

   The first step taken by the new economic authorities consisted in the
abandoning of the convertibility system that had governed the Argentine economy 
since 1991. After a series of false starts, it was eventually replaced by a     
floating rate system with Central Bank intervention. In less than three months  
the devaluation totalled approximately 200%.                                    

     A widespread pesification (forced conversion into pesos) was decreed in
clear violation of all contracts in force in the private and public sectors in  
Argentina. This pesification included the US$ 45 billion that still remained    
within the financial system. In addition, restrictions on disposing of cash were
tightened, and the repayment of deposits in excess of Ps. 10,000 was            
rescheduled, as a result of which they were to be repaid in installments through
to 2005. This measure known as the "corralon", in addition to failing to achieve
its principal objective, namely the prevention of any other outflow of deposits 
from the system, led to an even greater drop in the level of economic activity. 

   In spite of the efforts to contain the leakage of deposits out of the
financial system, the ineffectiveness of the measures adopted, added to the     
withdrawals of deposits as a result of the court rulings in favour of savers,   
forced the Central Bank to provide Ps. 20 billion in financial assistance to    
banks by means of repos and rediscounts. This phenomenal increase in money      
supply was mostly absorbed by the Central Bank itself bye means of the sale of  
its liquid international reserves, which dropped 35% (US$ 5.3 billion) in the   
first half of 2002.                                                             

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[GRAPHIC OBJECT OMITTED]
Source: Estudio M.A. Broda y Asoc.

On June 30, 2002, the US dollar price closed at Ps. 3.80, a 280%  
devaluation; in the first six months of the year the wholesale price index      
increased by 95.6% and consumer prices went up by 30.5% In this context it is   
hardly surprising that in the first quarter of 2002 there was a negative        
variation of GDP of 16.3% compared to the same period of the previous year, the 
largest drop recorded in the historical series. Overall demand fell sharply,    
mainly as a result of a drop of 46.1% in gross fixed domestic investment, and   
consumption fell 20.9%.                                                         

[GRAPHIC OBJECT OMITTED]
Source: Estudio M.A. Broda y Asoc.

       The trade balance became the only positive indicator in the economy, with
a surplus of US$ 8,175 million, explained by the collapse in imports, down 63.3%
year-on-year, while exports were down 7.4% because of the lower prices for      
exported goods (down 9.7%) and an increase in export volumes of 3.3%.           

       The drastic collapse of macroeconomic indicators was an announcement of a
sharp deterioration in private sector activity. Leading companies, including    
some of the highest capitalized firms in Argentina, declared they were unable to
meet their financial obligations after the devaluation reduced their income in  
terms of foreign currency to a fraction of former levels. As could be expected, 
in a reflex action aimed at ensuring survival, the most affected companies      
significantly reduced their personnel,                                          

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ensuring the unemployment level reached a historical high of 21.4% of the       
work-force.                                                                     

       During fiscal year 2001-2002, Argentine capital markets suffered from the
economic mismanagement just like other sectors. In this period, share prices    
according to the Merval, stated in dollars, fell back 78%. In the first weeks of
June, the Merval hit a low of 75 points, recording a loss of 92% compared to the
level reached five years earlier. Bond values were affected by the announcement 
of default on sovereign debt, falling dramatically, selling at parties of close 
to 20%. This took the country risk indicator, the spread on sovereign bonds over
US Treasury Bills, to an unheard level of 7,000 basis points.                   

[GRAPHIC OBJECT OMITTED]
 Source: Estudio M.A. Broda y Asoc

   The following macroeconomic indicators summarize the evolution of the
Argentine economy during the last eight years:                                  

LEADING INDICATORS                                                

                                                        [Enlarge/Download Table]


----------------------------------------------------------------------------------------------------------------------
                                                 1995    1996     1997     1998     1999    2000     2001   2002 (P)  
----------------------------------------------------------------------------------------------------------------------
                                                                                                                      
Real GDP Growth  (in %)                         -2,85    5,53     8,11     3,85    -3,39   -0,79    -4,41   -12,80    
Inflation (Combined Price Index) in % *          4,90    1,70     0,30    -1,10    -2,10   -1,50    -1,70    32,40    
Fiscal Result (as % of GDP)                     -1,51%  -2,22%   -1,47%   -1,39%   -2,59%  -2,44%   -3,22%   -1,41%   
Exports  FOB (Millions of U$S)                  21,16   24,04    26,43    26,43    23,31   26,41    26,66    25,50    
Imports CIF (Millions of U$S)                   20,20   23,86    30,50    31,40    25,51   25,24    20,31     9,50    
Balance of Payment's Current Account                                                                                  
(MM U$S)**                                      -5,20   -6,82   -12,29   -14,55   -11,95   -8,97    -4,43    10,30    
Trade Balance  (Millions of U$S)                 0,96    0,18    -4,07    -4,97    -2,20    1,17     6,34    16,00    
Unemployment Rate  ***                          17,40   17,20     14.9     12.9    14,30   15,10    17,35    22,00    
----------------------------------------------------------------------------------------------------------------------

(P) Projected*                                                    
Annual average**                                                  
Accrual basis***                                                  
Average for the country  (as % of E.A.P.)                         
Source: Estudio M.A. Broda y Asoc.                                

      The default on the debt, the abrupt end of Convertibility and the forced
conversion into pesos represent unprecedented events that defy the institutions 
governing the economy of a country. The consequences of such violations to      
security and legal guarantees in Argentina still remain to be seen. Many years  
of strict discipline will be required to repair the damage that has been caused.

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 DESCRIPTION OF OPERATIONS

     We are one of Argentina's leading real estate companies. We are engaged
directly and indirectly through subsidiaries and joint ventures in a range of   
real estate activities in Argentina. Our principal activities consist of: (i)   
the acquisition and development of residential properties primarily for sale,   
(ii) the acquisition, development and operation of office and other non-shopping
center retail properties primarily for rental purposes, (iii) the acquisition,  
development and operation of shopping center properties, (vi) the acquisition   
and operation of luxury hotels, and (v) the acquisition of undeveloped land     
reserves for future development or sales. We are the only Argentine real estate 
company with shares listed in the Buenos Aires Stock Exchange and the New York  
Stock Exchange.                                                                 

   Our headquarters are located at Bolivar 108, Buenos Aires (C1066AAD),
Argentina. Our telephone number is +54 (11) 4323-7555, our fax number is +54    
(11) 4323-7597 and our web site is www.irsa.com.ar.                             

COMMERCIAL STRATEGY                                                             

    As one of the few companies owning, developing and administrating real
estate in Argentina, we consider that we hold certain competitive advantages    
that we expect will allow us to continue to gain an increasing share of the real
estate property market in Argentina. These advantages include:                  

o    Our experience and that of our managers in the acquisition,  
          development, sale, leasing and management of top quality property;

o    Our considerable reputation and positioning as developers of 
            comprehensive real estate services in both Argentina and other Latin
American real estate markets;                           

   o    The quality of our existing portfolio of properties and our land
reserves;                                               

o    Our access to sources of long-term capital;                  

       o    Our strategy aimed at preserving a high level of liquidity, enabling
          better advantage to be taken of the real estate opportunities that
arise in favorable terms; and                           

o    The quality of our existing tenants and the high occupancy   
        percentage of our rental property portfolio, which enables us to
            count on a significant stable source of liquidity for our cash flow.

 Our strategy is to increase our cash flow, revenues and asset value
through the continuous expansion of our diversified portfolio of properties and 
assets by means of the purchase, development and operation of real property,    
either individually or in association with third parties, in all our business   
segments.                                                                       

Offices. We intend to purchase, develop and operate class A office
buildings, in the principal office areas of Buenos Aires and in other strategic 
areas, with attractive returns and capital appreciation potential. We believe   
that large Argentine and multinational companies will continue to show a growing
demand for class A offices, to the extent that their business continues to      
expand in Argentina and Latin America, which, in turn, will further encourage   
the shift from the traditional midtown office area to other more modern areas   
with better access and more convenient spaces. We have managed to create a      
top-quality tenant base.                                                        

       Shopping Centers. Through our subsidiary APSA, we seek to become a leader
in the shopping center industry in Argentina through the consolidation of our   
operations, new developments in strategic points of Buenos Aires and other large
cities of Argentina, and the purchase of the principal shopping centers. The    
main growth engines of the shopping center industry are: (i) the increase in the
consumption of goods capable of being sold in shopping centers; (ii) the change 
in buying habits, abandoning shopping at street-level retail stores; and (iii)  
the relatively low level of market penetration of shopping centers in Argentina 
as compared to many developed countries, which implies a significant growth     
potential in the long term. APSA                                                

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has been able to improve the operating margins of its shopping centers by       
consolidating its administration, which has enabled it to capitalize on         
operating synergies, scales of economy and marketing and promotion              
opportunities.                                                                  

    Residential Properties. We have benefited from the increased financing
available for the purchase of houses and the better transportation              
infrastructure from the center of the cities towards suburban areas. In urban   
areas, we seek to purchase undeveloped properties strategically located in      
densely populated areas for the development of apartment complexes that offer   
recreational "green areas", sports facilities and security services. In suburban
areas, we seek to purchase undeveloped properties close to Buenos Aires in order
to build residential neighborhoods, and, subsequently, sell the land for        
construction of houses after the installation of the basic infrastructure by us.

     Hotels. We intend to purchase first-line hotels, whenever opportunities
arise, and to delegate their operation to first-level hotel operators in order  
to capitalize on their operating experience, international networks and         
marketing agreements so as to take advantage of the benefits derived from the   
growing flow of tourism and trade.                                              

    Land Reserves. We continue to acquire undeveloped lands and properties
strategically located inside and outside the city. In all cases, the objective  
is to acquire lands with potential for development and appreciation for their   
subsequent sale. We consider that having a reserve of lands will enable us to   
have wide supply of properties for the development of new projects and will     
create a barrier against potential competitors.                                 

OVERVIEW OF PROPERTIES                                                          

     As of June 30, 2002, we either directly or through our subsidiaries and
joint ventures, owned significant interests in a portfolio of 58 properties in  
Argentina, located principally in Buenos Aires. The following table sets forth  
certain information concerning our operation and property portfolio.            

                                   CONSOLIDATED OPERATING INCOME (1)

                                                        [Enlarge/Download Table]


                                                     YEARS ENDED JUNE 30,              
                                       ------------------------------------------------
                                           2002         2001         2000       1999   
                                       ---------    -----------   ---------   ---------
                                                     (IN THOUSANDS OF PESOS)           
                                                                                       
Offices and other non-shopping center                                                  
   rental properties                    (23.616)      28.052        31.360      32,230 
Shopping centers                        (18.295)      32.223        23.809      30,513 
Development and sale of properties      (35.602)       4.128         5.835      33,175 
Hotels                                   (3.351)        (755)        2.868       3,507 
International                            33.924       21.610        33.617      22,907 
                                       ---------   -----------   ----------   ---------
   TOTAL                                (46.940)(2)   77.012        97.489     122,333 
                                       =========   ===========   ==========   =========

(1)  Prepared according to the proportional consolidation method. 

(2)  Includes Ps. 96.8 million for the writing down of certain    
properties.                                             

OFFICES AND OTHER NON-SHOPPING CENTER RENTAL PROPERTIES                         

      We are engaged in the acquisition, development and management of offices
and other non-shopping center rental properties in Argentina. As of June 30,    
2002, we, directly and indirectly, owned interests in 19 office and other       
non-shopping center rental properties in Argentina which comprised 129,179      
square meters of gross leasable area. Of these properties, 13 were office       
properties which comprised 89,409 square meters of gross leasable area. For the 
fiscal year ended June 30, 2002, we had net sales from office and other         
non-shopping center rental properties of Ps. 34.1 million.                      

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      All of our office rental properties in Argentina are located in the city
of Buenos Aires. Four of our properties are currently single tenant properties  
and the remaining properties are leased to multiple tenants. As of June 30,     
2002, the average occupancy rate of all of our office properties was            
approximately 72%. Five different tenants accounted for approximately 64.6% of  
our net revenues from office and other non-shopping center rental properties and
less than 5.5% of our total consolidated sales for the fiscal year ended June   
30, 2002. These five office tenants are: Grupo Total Austral, Grupo Danone,     
Cisco Systems Argentina S.A., Nextel Argentina S.A. and Allende y Brea.         

      Administration and Management. We generally act as the managing agent of
the office properties in which we own an interest. These interests consist      
primarily of the ownership of entire buildings or a substantial number of floors
in a building. The buildings in which we own floors are generally managed       
pursuant to the terms of a condominium agreement that typically provides for    
control by a simple majority of the interests (based on the area owned) in the  
building. As the managing agent of operations, we are responsible for handling  
services, such as security, maintenance and housekeeping. These services are    
generally contracted to third party providers. The cost of the services are     
passed-through and paid for by the tenants, except in the case of our unrented  
units, in which case we absorb the cost. Our leasable space is marketed through 
commissioned brokers, the media and directly by us.                             

    Leases. We generally lease space in our offices and other non-shopping
center rental properties pursuant to lease agreements with terms of three to    
five years that are renewable at the option of the tenant for additional two or 
three years. Our non-shopping center lease agreements are generally denominated 
in U.S. dollars and, in accordance with Argentine law, their terms are not      
subject to adjustment for inflation. Rents for renewal periods are based upon   
projected estimates of United States inflation or other customary factors.      

     The following table sets forth certain information regarding our direct
and indirect ownership interest in offices and other non-shopping center rental 
properties:                                                                     

 OFFICES AND OTHER NON-SHOPPING CENTER RENTAL PROPERTIES

                                                        [Enlarge/Download Table]


                          DATE     LEASABLE  OCCUPANCY   IRSA'S    MONTHLY     TOTAL RENTAL INCOME FOR     BOOK      
                           OF       AREA M2    RATE     INTEREST    RENTAL   THE FISCAL YEAR PS,/000 (4)  VALUE      
                      ACCQUISITION    (1)      (2)                  INCOME                                           
                                                                  PS./000 (3)  2002    2001      2000   PS./000 (5)  
---------------------------------------------------------------------------------------------------------------------
                                                                                                                     
OFFICES                                                                                                              
Inter-Continental                                                                                                    
Plaza (6)              11/18/97     22,535      83%         67%      347      7,564    9,445    8,631     38,612     
Libertador 498         12/20/95     11,152      59%        100%      178      4,638    6,270    7,639     33,744     
Maipu 1300             9/28/95      10,325      62%        100%      153      4,500    5,779    5,755     36,922     
Laminar Plaza          3/25/99       6,521      95%        100%      213      4,426    5,025    3,069     25,343     
Madero 1020 (7)        12/21/95      5,056      45%        100%       60      1,886    3,617    3,656     13,755     
Reconquista 823/41     11/12/93      6,100      0%         100%       0       2,070    3,013    2,700     15,807     
Suipacha 652/64        11/22/91     11,453      45%        100%       56      1,299    2,658    3,181      9,021     
Edificios Costeros     3/20/97       6,399      27%        100%       41      1,353    2,034      158     21,197     
Costeros Dique IV      8/29/01       5,437      63%        100%      101      1,712      -        -       15,877     
Others  (8)                          4,431      65%        N/A        56      1,333    1,653    1,958     10,362     
---------------------------------------------------------------------------------------------------------------------
SUBTOTAL                            89,409      60%        N/A     1,205     30,781   39,494   36,747    220,640     
     OTHER RENTAL PROPERTIES                                                                                         
Commercial Properties (9)                                                                                            
(10)                                 6,023      99%        100%       32      2,095    4,296    7,625      5,486     
 Other properties (11)              33,747     100%        N/A        40      1,281    1,901    2,641      4,570     
---------------------------------------------------------------------------------------------------------------------
 SUBTOTAL                            39,770     100%       N/A         72     3,376    6,197   10,266     10,056     

 RELATED EXPENSES                                                                                                    
 MANAGEMENT FEES                                                              1,134    1,291    1,123                
---------------------------------------------------------------------------------------------------------------------
TOTAL OFFICES AND                                                                                                    
 OTHER (12)                         129,179      72%       N/A      1,277    35,291   46,982   48,136    230,696     
---------------------------------------------------------------------------------------------------------------------

(1)    Total leasable area for each property. To obtain the square meters       
       attributable to us, this column should be multiplied by our net ownership
interest. Excludes common areas and parking.                      
(2)    Calculated dividing occupied square meters by leasable area.             
(3)    Agreements in force as of 06/30/02 were computed, pro-rata our Company's 
net ownership interest in each property.                          

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(4)    Total consolidated leases, as authorized by the Comision Nacional de     
       Valores, reexpressed as of 06/30/02. Excludes gross income tax deduction.
(5)    Cost of acquisition, plus improvements, less accumulated depreciation,   
plus adjustment for inflation as of 06/30/02.                     
(6)    Through Inversora Bolivar S.A.                                           
(7)    Includes in the book value Ps. 4,730,000 corresponding to 1,716 m2 and 36
      parking places, all of which are exposed in "Inventory" in our Financial
Highlights.                                                       
(8)    Includes the following properties: Madero 942, Av. De Mayo 595/99, Av.   
Libertador 602 and Sarmiento 517 (through our Company). Cumulative
       revenues for the fiscal years 2001 and 2000 include revenues from Avenida
     de Mayo 701 (fully sold) Puerto Madero Dock 5 and Puerto Madero Dock 6.
(9)    Includes the following properties: Constitucion 1111 and Alsina 934/44   
     (through our Company). Cumulative revenues include: In all fiscal years
 reported, the revenues from Santa Fe 1588 and Rivadavia 2243 (fully
       sold). In fiscal years 2001 and 2000, the revenues from Sarmiento 580 and
  Montevideo 1975 (fully sold). In fiscal year 2000, the revenues from
Galerias Pacifico.                                                
(10)   Includes in the book value Ps. 3,767 thousand, corresponding to 1,947 m2 
 from the property located at Constitucion 1111, which is exposed in
"Inventory" in our Financial Highlights.                          
(11)   Includes the following properties: the Santa Maria del Plata facilities  
  (former Ciudad Deportiva de Boca Juniors, through our Company - only
  rents are included since book value is reflected on the Developments
     table) - Aguero 596 and R. Nunez 4615 (Cordoba), plots in Carlos Gardel
    (through Alto Palermo S.A), Thames, 1 unit in Alto Palermo Plaza and 2
     units in Alto Palermo Park (through Inversora Bolivar S.A.). Cumulative
       revenues include: In fiscal year 2001 and 2000, the revenues from Serrano
  250 (fully sold). In fiscal year 2000, the revenues from Cervino and
Terrenos Monserrat (completely sold).                             
(12)   Corresponds to the "Offices and Other Rental Properties" business unit   
    mentioned in Note 4 to the Consolidated Financial Statements. Excludes
gross income tax deduction.                                       

  The following table shows a schedule of the lease expirations of our
office and other non-shopping center properties for leases outstanding as of    
June 30, 2002, assuming that none of the tenants exercise renewal options or    
terminate their lease early. Most tenants have renewal clauses in their leases. 

                                                        [Enlarge/Download Table]


                                               PERCENTAGE OF   ANNUAL RENTAL    PERCENTAGE OF 
                  NUMBER OF   SQUARE METERS    TOTAL SQUARE    INCOME UNDER     TOTAL RENTAL  
 FISCAL YEAR OF     LEASES     SUBJECT TO     METERS SUBJECT  EXPIRING LEASES   INCOME UNDER  
LEASE EXPIRATION   EXPIRING  EXPIRING LEASES   TO EXPIRATION        (1)        EXPIRING LEASES
----------------  ---------  ---------------  --------------  ---------------  ---------------
                                                                                              
                                  (m2)              (%)           (Ps. )             (%)      
2002                   6          5.916              6%             70,000            5%      
2003                  28         51.598             55%            457,322           31%      
2004                  32         13.272             14%            329,281           23%      
2005                   7          5.299              6%            133,513            9%      
2006+                 11         17.291             19%            462,721           32%      
                    ----        -------           ----            --------          ---       
Total                 84         93.377            100%           1,452,837         100%      
                    ----        -------           ----            ---------         ---       


     (1)  Excludes Thames and Serrano rental properties. Not proportional to
our actual holding in each property.                    

 Properties. Set forth below you will find information regarding our
principal currently owned office properties, including the names of the tenants 
occupying 5% or more of the gross leasable area of each property.               

       INTER-CONTINENTAL PLAZA, CITY OF BUENOS AIRES. Inter-Continental Plaza is
a modern 24-story building located next to the Inter-Continental Hotel in the   
historic neighborhood of Monserrat in downtown city of Buenos Aires. We own the 
entire building which has floor plates averaging 900 square meters. It has 203  
parking spaces. The principal tenants currently include Total Austral S.A.,     
Bagley S.A., Vintage Oil Argentina Inc. Sucursal Argentina, Pharmacia Argentina 
S.A. and Mercedes Benz Leasing Argentina S.A                                    

       LIBERTADOR 498, CITY OF BUENOS AIRES. Libertador 498 is a 27-story office
tower located at the intersection of Avenida 9 de Julio, Avenida del Libertador 
and Autopista Illia, three of the most important thoroughfares of the city of   
Buenos Aires, making it accessible from the north, west and south of the city.  
We own 20 floors with floor plates averaging 620 square meters. The building has
a singular cylindrical design and a highly visible circular neon billboard that 
makes it a landmark in the Buenos Aires skyline. The principal tenants in this  
building currently include Epson Argentina S.A., MTV Networks Latin America     
Inc., Farmanet S.A., Heidrick & Struggles Argentina S.A. and Eastman Chemical   
Argentina S.R.L. Chrysler Argentina S.A. leases the billboard for an annual rent
of Ps. 120,000 through June 30, 2002.                                           

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     MAIPU 1300, CITY OF BUENOS AIRES. Maipu 1300 is a 23-story office tower
located on the San Martin Plaza, a prime office zone, on Avenida del Libertador,
a major north-south thoroughfare. The building is also located within walking   
distance of the Retiro commuter train station, Buenos Aires' most important     
public transportation hub, connecting rail, subway and bus transit. We own the  
entire building which has floor plates averaging 440 square meters. The         
building's principal tenants currently include Tecpetrol S.A., Allende & Brea,  
Petrolera Santa Fe S.A. and Totalfinaelf Gas Transmission Argentina S.A.        

     LAMINAR PLAZA, CITY OF BUENOS AIRES. Laminar Plaza is a 20-story office
building located in Catalinas, the city of Buenos Aires' most exclusive office  
district. The floor plates each measure 1,453 square meters. The main tenants,  
among others, are as follows: Cisco Systems, Movicom Bellsouth, Chubb Argentina 
de Seguros S.A., La Plata Cereal and Bank Hapoalim B.M.                         

       MADERO 1020, CITY OF BUENOS AIRES. Madero 1020 is a 25-story office tower
located in the center of the Catalinas area, a prime office zone, with          
spectacular views of the Port of Buenos Aires, the Rio de la Plata and downtown 
Buenos Aires. We own 10 non-contiguous floors with the floor plates averaging   
572 square meters. The building's principal tenants currently include Abeledo   
Gottheil Abogados S.C., Compania Ericsson S.A.C.E.I. and DuPont S.A.            

     SUIPACHA 652/64, CITY OF BUENOS AIRES. Suipacha 652/64 is a seven-floor
office building located in the office district of the city of Buenos Aires. We  
own the entire building which has floor plates unusually large, measuring 1,580 
square meters on most floors. This property underwent substantial renovations   
shortly after we acquired the deed in 1991 to prepare the building for rental.  
The building's principal tenants currently include Procter & Gamble             
Interamericas Inc. and APSA's subsidiary, Tarshop.                              

RECONQUISTA 823/41, CITY OF BUENOS AIRES. Reconquista 823/41 is a 
15-story office tower located in the Catalinas area. We own the entire building 
which is currently fully leased to Aguas Argentinas. The office building is     
comprised of three basement levels with 56 parking spaces, a ground floor and 15
additional floors of office space. The floor plates average 540 square meters.  
As of May 2002, the property was leased to Aguas Argentinas, who decided not to 
continue the lease contract.                                                    

    EDIFICIOS COSTEROS, DOCK 2, CITY OF BUENOS AIRES. Costeros A and B are
two four-story buildings developed by us and located in the Puerto Madero area. 
We own the two buildings which have a gross leasable area of 6,399 square meters
and 67 parking spaces. In September 1999 we completed their construction and in 
April 2000 began to market the office spaces. The main tenants of these         
properties are as follows: Leo Burnett Worldwide Invest. Inc., APSA's           
subsidiary, Altocity.Com, Red Alternativa S.A. and Alternativa Gratis S.A. We   
currently intend to develop two additional buildings on the adjacent land but   
have not yet established a date to begin construction.                          

      EDIFICIOS COSTEROS, DOCK 4, CITY OF BUENOS AIRES. On August 29, 2001, we
signed the deed of sale of "Section C" of the office complex known as Puerto del
Centro that includes buildings "5" and "6". This property is located in Pierina 
Daelessi street N(degree) 340, over the East Side of Dock 4 of Puerto Madero and
has approximately 5,500 square meters of gross leasable area and 50 parking     
lots. The building's principal tenants currently include Nextel Argentina S.A., 
Patagon Internacional S.A. and Petroenergy S.A.                                 

  OTHER OFFICE PROPERTIES. We also have interests in four other office
properties, all of which are located in the city of Buenos Aires. These         
properties are either entire buildings or portions of buildings, none of which  
contributed more than Ps. 1.0 million in annual rental income for fiscal year   
2002. These properties include Constitucion 1111 and Alsina 934.                

      RETAIL AND OTHER PROPERTIES. Our portfolio of rental properties includes
nine rental properties that are leased as street retail, supermarkets, a        
warehouse and various other uses. Most of these properties are located in the   
city of Buenos Aires, although some are located in other cities in Argentina.   
These properties include Santa Fe 1588/600 and Rivadavia 2243/65.               

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SHOPPING CENTERS                                                                

 We are also engaged in purchasing, developing and managing shopping
centers, through our subsidiary APSA. As of June 30, 2002, APSA operated and    
owned majority interests in seven shopping centers, five of which are located in
the city of Buenos Aires. One shopping center is located in greater Buenos Aires
area and another is in the city of Salta. APSA also owns indirectly an 18.9%    
non-controlling interest in Mendoza Plaza in the city of Mendoza. In addition to
purchasing, developing and managing shopping centers, APSA owns an 80% interest 
in Tarshop, a limited purpose credit card company which originates credit card  
accounts to promote sales from APSA's tenants and other selected retailers.     

   APSA's shopping centers comprised a total of 181,085 square meters of
gross leasable area (excluding certain space occupied by hypermarkets which are 
not APSA's tenants). As of June 30, 2002, the average occupancy rate of the     
shopping center portfolio was approximately 92%. During the year ended June 30, 
2002, net sales from shopping centers amounted to Ps. 43.3 million.             

      Management and administration. As a result of the acquisition of several
shopping centers and of the corporate reorganization of APSA, we were able to   
reduce expenses by centralizing management of the shopping centers in APSA. All 
of our shopping centers are owned through APSA, and all of them, except Mendoza 
Plaza, are managed by APSA. As manager, APSA is responsible for providing common
area electrical power, a main telephone switchboard and central air conditioning
and other basic common area services.                                           

      We currently own 49.7% of APSA. On June 30, 2002, 27.8% of APSA's shares
were held by Parque Arauco S.A. and 6.4% by GSEM/AP Holdings L.P. The remaining 
shares are held by the public and traded on the Buenos Aires Stock Exchange and 
on the Nasdaq Stock Market in the form of American Depositary Shares (NASDAQ    
symbol: APSA).                                                                  

       Leases. APSA enters into commercial leases with tenants for terms ranging
from three to ten years, with most leases having terms of no more than five     
years. Lease agreements are generally denominated in U.S. dollars and subject to
rent escalation clauses. Shopping center leases generally do not contain renewal
options. Tenants are generally charged a rent which consists of the higher of   
(i) a base rent and (ii) a percentage rent which generally ranges between 4% and
8% of tenant's sales. Furthermore, pursuant to the rent escalation clause in    
most leases, a tenant's base rent generally increases between 4% and 7% each    
year during the term of the lease. Tenants are also required to pay for the     
direct expenses of their units, such as electricity, water, telephone and air   
conditioning, as well as their proportion of the common area expenses. In       
addition, tenants pay between approximately 12% and 15% of their base rent into 
a common promotion fund. In the cases where APSA acts as manager, APSA receives 
an administration fee.                                                          

     In addition to rent, tenants are generally charged a key money which is
an admission fee that tenants pay upon entering into a lease and upon lease     
renewal. Key money is normally paid in one lump sum or in a small number of     
monthly installments. If the tenant pays in installments, it is the tenant's    
responsibility to pay for the balance of any such amount unpaid in the event the
tenant terminates its lease prior to its expiration. In the event of            
termination, a tenant will not be refunded its key money.                       

   The following table shows certain information concerning our shopping
centers:                                                                        

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SHOPPING CENTER PROPERTIES

                                                        [Enlarge/Download Table]


                       DATE       GROSS     PERCENTAJE    EIRSA'S   MONTHLY   TOTAL RENTAL INCOME FOR THE   BOOK  
                        OF      LEASEABLE     LEASED      INTEREST   INCOME     FISCAL YEAR PS./000 (3)     VALUE 
                    ACQUISITION  AREA M2 (1)    (2)                 PS./000   2002      2001     2000      PS./000
------------------------------------------------------------------------------------------------------------------
                                                                                                                  
SHOPPING CENTERS (5)                                                                                              
Alto Palermo          12/23/97    18,129        92%          50%      N/A     17,116   21,902   23,281     116,957
Abasto                 7/17/94    40,476        95%          50%      N/A     15,394   19,926   20,937     104,622
Alto Avellaneda       12/23/97    26,701        94%          50%      N/A     10,623   14,347   15,955      44,469
Paseo Alcorta          6/6/97     14,909        84%          50%      N/A      8,238   10,738   11,154      33,716
Patio Bullrich         10/1/98    11,623        91%          50%      N/A      6,377    7,158    6,686      59,389
Nuevo NOA Shopping     3/29/95    18,876        88%          50%      N/A      1,980    2,244    1,786       9,768
Others (6)                        50,371        94%          N/A      N/A      1,676    1,860    2,379      16,839
------------------------------------------------------------------------------------------------------------------

Fibesa and others (7)                                        N/A      N/A      2,334    3,592     0               
Revenues Tarjeta                                                                                                  
Shopping                                                     40%      N/A     16,088   15,530   10,121            

------------------------------------------------------------------------------------------------------------------
TOTAL SHOPPING CENTERS (8)       181,085       92%           N/A      N/A     79,825   97,295   92,299     385,760
------------------------------------------------------------------------------------------------------------------

Notes:                                                                          
(1) Total leasable area in each property. To obtain the square meters           
attributable to the Company, this column should be multiplied by th             
Company's net ownership interest. Excludes common areas and parking spaces.     
(2) Calculated dividing occupied square meters by leasable area.                
(3) Total consolidated rents, according to the Comision Nacional de Valores     
(CNV), adjusted for inflation as of June 30, 2002. Excludes gross income tax    
deduction.                                                                      
(4) Cost of acquisition plus improvements, less accumulated depreciation, plus  
adjustment for inflation as of 06/30/02.                                        
(5) Through Alto Palermo S.A.                                                   
(6) Includes the following properties: Buenos Aires Design and Mendoza Plaza    
Shopping.                                                                       
(7) Includes revenues from Fibesa S.A. and Alto Invest.                         
(8) Corresponds to the "Shopping Centers" business unit mentioned in Note 4 to  
the Consolidated Financial Statements. Excludes gross income tax deduction.     

The following table shows a schedule of lease expirations for our 
shopping center properties in place (except Mendoza Plaza) as of June 30, 2002, 
assuming that none of the tenants exercise renewal options or terminate their   
lease early.                                                                    

                                                        [Enlarge/Download Table]


                                                     PERCENTAGE OF                  PERCENTAGE OF 
                                    SQUARE METERS    TOTAL SQUARE     ANNUAL RENT     TOTAL RENT  
 FISCAL YEAR OF      NUMBER OF       SUBJECT TO     METERS SUBJECT  UNDER EXPIRING  UNDER EXPIRING
LEASE EXPIRATION  LEASES EXPIRING  EXPIRING LEASES   TO EXPIRATION    LEASES (1)        LEASES    
----------------  ---------------  ---------------  --------------  --------------  --------------
                                        (m2)              (%)            (Ps.)           (%)      
                                                                                                  
    2002 (2)...         182            20,286            14.5          8,598,838        16.1      
    2003.......         267            24,729            17.7          17,108,221       32.1      
    2004.......         173            21,265            15.2          9,854,933        18.5      
    2005.......         138            18,774            13.4          7,960,922        14.9      
    2006.......          67            18,820            13.5          4,629,990         8.7      
    2007+......          35            36,041            25.8          5,153,778        10.0      
                  ---------------  ---------------  --------------  --------------  --------------
    TOTAL......         862           139,915            100.0        53,306,682       100.00     


(1)    Includes only the basic rental income amount. Does not give effect to our
ownership interest.                                               

(2)    Includes vacant stores at June 30, 2002.                                 

Properties. Set forth below is information regarding our principal
shopping centers.                                                 

     ALTO PALERMO SHOPPING, CITY OF BUENOS AIRES. Alto Palermo Shopping is a
155-store shopping center that opened in 1990 and is located in the densely     
populated neighborhood of Palermo in the city of Buenos Aires. Alto Palermo     
Shopping is located at the intersection of Santa Fe and Coronel Diaz avenues,   
only a few minutes from downtown city of Buenos Aires and has nearby access from
the Bulnes subway                                                               

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station. Alto Palermo Shopping has a total constructed area of 64,672 square    
meters that consists of 18,129 square meters of gross leasable area. The        
shopping center has a two-screen movie theatre, an entertainment center and a   
food court with 20 restaurants. Alto Palermo Shopping is spread out over four   
levels and has a 741-car pay parking. Tenants in this shopping center generated 
average estimated monthly retail sales of approximately Ps. 633.0 per square    
meter for the year ended June 30, 2002. Principal tenants currently include     
Fravega, Mc Donald's, Musimundo, Garbarino and Zara.                            

     ALTO AVELLANEDA, AVELLANEDA, GREATER BUENOS AIRES. Alto Avellaneda is a
155-store shopping center that opened in October 1995 and is located in the     
highly populated neighborhood known as Avellaneda, on the southern border of the
city of Buenos Aires. Alto Avellaneda has a total constructed area of 95,722    
square meters that includes 26,701 square meters of gross leasable area. Alto   
Avellaneda includes several anchor stores, a six-screen multiplex movie theatre,
a Wal-Mart superstore, an entertainment area, a bowling alley, a 19-restaurant  
food court and an outdoor parking lot. Wal-Mart purchased the space it now      
occupies. Tenants in this shopping center generated average estimated monthly   
retail sales of Ps. 345.3 per square meter for the year ended June 30, 2002.    
Principal tenants currently include Mc Donald's, Musimundo, El Bingo, Rodo and  
Garbarino.                                                                      

PASEO ALCORTA, CITY OF BUENOS AIRES. Paseo Alcorta is a 124-store 
shopping center that opened in 1992 and is located in the residential           
neighborhood of Palermo Chico, one of the most exclusive areas in the city of   
Buenos Aires, within a short drive from downtown city of Buenos Aires. Paseo    
Alcorta has a total constructed area of approximately 78,000 square meters that 
consists of 14,909 square meters of gross leasable area. The three-level        
shopping center includes a four-screen multiplex movie theatre, a 24-restaurant 
food court, a Carrefour hypermarket, and a free parking lot with approximately  
1,500 spaces. Carrefour purchased the space it now occupies but it pays         
proportional expenses of the shopping center. Tenants in this shopping center   
generated average estimated monthly retail sales of Ps. 482.3 per square meter  
for the year ended June 30, 2002. Principal tenants currently include Cristobal 
Colon, McDonald's, Kartum, Musimundo and Fravega.                               

   ABASTO SHOPPING, CITY OF BUENOS AIRES. Abasto Shopping is a 182-store
shopping center located in the city of Buenos Aires. Abasto Shopping is directly
accessible from the Carlos Gardel subway station and is located six blocks from 
the Once railway terminal and a few blocks from the highway to Ezeiza           
International Airport. Abasto Shopping opened in November 1998. The principal   
building is a landmark building which during the period 1889 to 1984 operated as
the primary fresh produce market for city of Buenos Aires. The property was     
converted into a 111,200 square meter shopping center, with approximately 40,476
square meters of gross leasable area. Abasto Shopping is located across from    
Torres de Abasto residential apartment development. The shopping center includes
a food court with restaurants covering an area of 5,600 square meters, a        
12-screen multiplex movie theatre, entertainment facilities and the "Museo de   
los Ninos Abasto", a museum for children. Abasto Shopping is spread out over    
five levels and has a 2,500-car parking lot. Tenants in Abasto have generated   
estimated average monthly sales of Ps. 283,8 per square meter for the year ended
June 30, 2002. Principal tenants currently include Musimundo, McDonald's, Zara, 
Rodo and Hoyts Cinemas.                                                         

PATIO BULLRICH, CITY OF BUENOS AIRES. Patio Bullrich is a 89-store
shopping center located in Recoleta, a popular tourist zone in the city of      
Buenos Aires a short distance from the Caesar Park and Hyatt hotels. Patio      
Bullrich has a total constructed area of 27,811 square meters that consists of  
11,623 square meters of gross leasable area. The four-story shopping center     
includes a 22-restaurant food court, an entertainment area, a six-screen        
multiplex movie theatre and a parking lot with 228 spaces. Patio Bullrich is    
currently one of the most successful malls in Argentina in terms of sales per   
square meter, producing for tenants average estimated monthly retail sales of   
Ps. 466.1 per square meter for the year ended June 30, 2002. Principal tenants  
currently include Paula Cahen D'anvers, Cipriani Dolce, Buquebus, Cacharel      
Damas and Beauty Shop.                                                          

 ALTO NOA, SALTA, PROVINCE OF SALTA. Alto Noa is a 91-store shopping
center located in the city of                                                   

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Salta, the capital of the province of Salta. The shopping center consists of    
31,836 square meters of total constructed area that consists of 18,876 square   
meters of gross leasable area and includes a 13-restaurant food court, a        
children's amusement center, a supermarket, an eight-screen movie theatre and   
parking facilities for 551 cars. Tenants have generated estimated average       
monthly sales of Ps. 124.6 per square meter for the year ended June 30, 2002.   
Principal tenants currently include Fravega, Mc Donald's, Hoyts General Cinema, 
Repsol Y.P.F. and Casa Lozano S.A.                                              

      BUENOS AIRES DESIGN, CITY OF BUENOS AIRES. Buenos Aires Design Center is
a 66-store shopping center intended for specialty interior, home decorating and 
restaurants that opened in 1993. APSA owns Buenos Aires Design through a 51%    
interest in Emprendimientos Recoleta, which owns the concession to operate the  
shopping center. Buenos Aires Design is located in Recoleta. Buenos Aires Design
has a total constructed area of 22,790 square meters that consists of 10,004    
square meters of gross leasable area. The shopping center has 11 restaurants, is
divided into two floors and has a 178-car parking lot. Tenants in this shopping 
have generated estimated average monthly sales of Ps. 213.3 per square meter for
the year ended June 30, 2002. Principal tenants currently include Vivendi, Bazar
Geo, Iluminacion Aguero, Hard Rock Cafe and Morph.                              

       MENDOZA PLAZA, MENDOZA, PROVINCE OF MENDOZA. Mendoza Plaza is a 137-store
shopping center located in the city of Mendoza in the province of Mendoza. It   
consists of 40,367 square meters of gross leasable area. Mendoza Plaza has a    
multiplex movie theatre covering an area of approximately 3,515 square meters   
with ten screens, the Chilean department store Falabella, a food court with 15  
restaurants, an entertainment center and a supermarket which is also a tenant.  
The monthly rental average of the leaser is estimated in Ps. 182,8 by square    
meters for the year ended June 30, 2002. It is owned through APSA's 18.9%       
interest in Perez Cuesta.                                                       

       TARJETA SHOPPING. Tarjeta Shopping is a non-banking credit card issued by
Tarshop, which is a limited purpose credit card company, engaged in credit card 
operations and is not affiliated to any bank. Tarshop originates credit card    
accounts to encourage customers to purchase goods and services from our shopping
centers. Tarjeta Shopping is currently accepted in five shopping centers and an 
extensive network of supermarkets and stores.                                   

     As of June 30, 2002, Tarshop had total assets of approximately Ps. 37.2
million and shareholder's equity of Ps. 6.2 million. For the fiscal year ended  
June 30, 2002, Tarshop's total net sales were Ps. 40.8 million, representing    
approximately 24.02 % of APSA's net sales for such period. As of June 30, 2002, 
Tarshop had approximately Ps. 62.3 million in credit card receivables           
outstanding (including asset-backed securities), compared to Ps. 72.8 as of June
30, 2001.                                                                       

SALES AND DEVELOPMENT PROPERTIES; UNDEVELOPED PARCELS OF LAND                   

RESIDENTIAL DEVELOPMENT PROPERTIES                                

    The acquisition and development of residential apartment complexes and
residential communities for sale is one of our core activities. Our development 
of residential apartment complexes consists of the new construction of high-rise
towers or the conversion and renovation of existing structures such as factories
and warehouses. In residential communities, we acquire vacant land, develop the 
infrastructure such as roads, utilities and common areas, and sell plots of land
for construction of single-family homes. We may also develop or sell portions of
land for others to develop complementary facilities such as areas for shopping  
in the area of the residential developments. In fiscal year 2002 net sales from 
the sales and developments segments fell to Ps. 45.2 million, compared to Ps.   
89.8 million in fiscal year 2001. This reduction has mainly been due to the     
reduced stock of units available for sale at present as a result of the halting 
of new development launches several quarters back, a decision that was based on 
the sharp fall in agregate demand.                                              

Construction and renovation works on our residential development  
properties is currently performed,                                              

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under our supervision, by independent Argentine construction companies that are 
selected through a bidding process. We enter into turnkey contracts with the    
selected company for the construction of residential development properties     
pursuant to which the selected company agrees to build and deliver the          
development for a fixed price and at a fixed date. We are generally not         
responsible for any additional costs based upon the turnkey contract. All other 
aspects of the construction including architectural design are performed by     
third parties.                                                                  

    Prior to the commencement of construction of a residential project, we
conduct an advertising program that continues after the launching of the sales  
of the units. In addition, we have showcased some of our renovation projects    
through Casa FOA, a highly visited fundraising exhibition where architects and  
designers display their work. This exhibition has wide public appeal and has    
been a successful marketing tool for us.                                        

 The following table shows certain information and gives an overview
regarding our sales and development properties:                                 

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DEVELOPMENT PROPERTIES                                                          

                                                        [Enlarge/Download Table]


                                                                       TOTAL                                                        
                         DATE OF      ESTIMATED/     AREA DESTINED                  IRSA'S   PERCENTAGE   PERCENTAGE    ACCUMULATED 
                       ACQUISITION    ACTUAL COST      FOR SALES    UNITS OR LOTS  INTEREST  CONSTRUCTED   SOLD (4)        SALES    
                                     (PS.000) (1)      (M2) (2)         (3)                                            (PS. 000) (5)
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                    
APPARTMENT COMPLEXES                                                                                                                
--------------------                                                                                                                
Torres Jardin            7/18/96        50,348          32,244         490           100%        100%          97%         62,176   

Torres de Abasto (8)     7/17/94        33,079          35,630         545            50%        100%          99%         48,104   

Palacio Alcorta          5/20/93        67,463          25,555         191           100%        100%         100%         68,152   

Concepcion Arenal        12/20/96       13,410           6,913          70           100%        100%          97%         10,249   

Alto Palermo Park (9)    11/18/97       21,348          10,654          73            67%        100%          88%         25,015   

Other  (10)                             38,346          23,240         178           N/A         100%          97%         42,149   
------------------------------------------------------------------------------------------------------------------------------------
SUBTOTAL                                223,994        134,236        1,547          N/A         N/A          N/A          255,845  

RESEIDENTIAL                                                                                                                        
------------                                                                                                                        
COMMUNITIES                                                                                                                         
-----------                                                                                                                         
Abril/Baldovinos (11)     1/3/95        97,119        1,408,905       1,273           83%        100%          85%         139,449  
Villa Celina I, II y                                                                                                                
III                      5/26/92         4,220          75,970         219           100%        100%         100%         12,391   

Villa Celina IV y V      12/17/97        2,180          58,480         181           100%        100%          98%          8,439   

Other (12)                               4,259          43,762          33           N/A         100%         100%          4,746   
------------------------------------------------------------------------------------------------------------------------------------
SUBTOTAL                                107,778       1,587,117       1,706          N/A         N/A          N/A          165,025  

LAND RESERVES                                                                                                                       
-------------                                                                                                                       
Dique 3 (parcela 1)                                                                                                                 
(13)                      9/9/99                        6,169                        50%          0%           0%             -     
Dique 3 (parcela 2)                                                                                                                 
(14)                      9/9/99                        7,221                        50%          0%           0%             -     
Dique 3 (parcela 3)                                                                                                                 
(15)                      9/9/99                        7,557                        50%          0%           0%             -     
Caballito                11/3/97                        20,968                      100%          0%           0%             -     
Puerto Retiro (9)        5/18/97                        82,051                       33%          0%           0%             -     
Santa Maria del Plata    7/10/97                       715,952                      100%          0%           0%             -     
Pereiraola (11)          12/16/96                     1,299,630                      83%          0%           0%             -     

Monserrat (9)            11/18/97                       3,400                        67%          0%         100%          3,274    
Dique 4 (ex Soc del                                                                                                                 
Dique)                    12/2/97                       4,653                       100%          0%          50%          10,955   
Other (16)                                            4,441,363                      N/A           0%                        -      
------------------------------------------------------------------------------------------------------------------------------------

SUBTOTAL                                              6,588,964                      N/A         N/A          N/A          14,229   

OTHER                                                                                                                               
-----                                                                                                                               
Hotel Llao- Llao          6/1/97        11,725           -               0          100%        100%          50%          14,671   

Galerias Pacifico         4/6/99          291            -               0          100%        100%         100%          5,869    

Sarmiento 580            1/12/94        10,404           2,635          14          100%        100%         100%          9,644    

Santa Fe 1588            11/2/94         7,423           2,713          20          100%        100%         100%          7,267    

Rivadavia 2243/65         5/2/94         7,267           2,070           4          100%        100%         100%          3,257    

Libertador 498           12/20/95        4,519           1,491           2          100%        100%         100%          3,220    

Other Properties (17)                   73,313          47,690         266                      100%          97%          96,919   
------------------------------------------------------------------------------------------------------------------------------------

SUBTOTAL                               117,942          56,599         306           N/A         N/A          N/A         140,847   

SUBTOTAL                               449,714        8,366,916        3,559         N/A         N/A          N/A         575,946   
------------------------------------------------------------------------------------------------------------------------------------

INTEREST FOR FINANCING PROPERTY SALES                                                                                      4,015    
MANAGEMENT FEES                                                                                                            1,742    

TOTAL (18)                             449,714       8,366,916         3,559          N/A        N/A           N/A        575,946   
------------------------------------------------------------------------------------------------------------------------------------



                            ACCUMULATED SALES FOR FISCAL YEAR ENDED JUNE                                                            
                                         30 (6) (PS. 000)                      BOOK VALUE (7)                                       
                                02              01              00              PROPORTIONAL                                        
                             (PS. 000)       (PS. 000)        (PS. 000)       VALUE) (PS. 000)                                      
----------------------------------------------------------------------------------------------                                      
                                                                                                                                    
APPARTMENT COMPLEXES                                                                                                                

Torres Jardin                 1,837           4,680            6,649                 617                                            

Torres de Abasto (8)          1,784           5,314            4,577                 6,394                                          

Palacio Alcorta                540              -               18                    -                                             

Concepcion Arenal              323            3,341            2,439                 194                                            

Alto Palermo Park (9)         8,729          (1,062)           2,782                 3,034                                          

Other  (10)                   1,635           1,784            2,048                 1,394                                          
---------------------------------------------------------------------------------------------                                       
SUBTOTAL                     14,848          14,057           18,513                11,633                                          

RESEIDENTIAL                                                                                                                        
COMMUNITIES                                                                                                                         

Abril/Baldovinos (11)        11,188          30,235           19,537                15,801                                          
Villa Celina I, II y                                                                                                                
III                           (46)              6              106                   39                                             

Villa Celina IV y V            121            2,582            5,736                  9                                             

Other (12)                     -                -              141                    -                                             
-----------------------   --------------------------------------------------------------------                                      
SUBTOTAL                     11,263          32,823           25,520                15,849                                          

LAND RESERVES                                                                                                                       
Dique 3 (parcela 1)                                                                                                                 
(13)                           -                -               -                    8,554                                          
Dique 3 (parcela 2)                                                                                                                 
(14)                           -                -               -                   10,016                                          
Dique 3 (parcela 3)                                                                                                                 
(15)                           -                -               -                   10,478                                          
Caballito                      -                -               -                   12,120                                          
Puerto Retiro (9)              -                -               -                   27,199                                          
Santa Maria del Plata          -                -               -                  103,213                                          
Pereiraola (11)                -                -               -                   15,695                                          

Monserrat (9)                  -              1,069            2,205                  -                                             
Dique 4 (ex Soc del                                                                                                                 
Dique)                         -             10,955             -                    5,483                                          
Other (16)                     -                -               -                   22,639                                          
-----------------------    ---------------------------------------------------------------                                          

SUBTOTAL                       -             12,024            2,205               215,397                                          

OTHER                                                                                                                               

Hotel Llao- Llao               -                -             14,671                  -                                             

Galerias Pacifico              -                -              5,869                  -                                             

Sarmiento 580                  -              9,644             -                     -                                             

Santa Fe 1588                7,267              -               -                     -                                             

Rivadavia 2243/65            3,257              -               -                     -                                             

Libertador 498               3,220              -               -                     -                                             

Other Properties (17)        1,832           10,613            2,709                 1,294                                          
-----------------------    ---------------------------------------------------------------                                          

SUBTOTAL                    15,576           20,257           23,249                 1,294                                          

SUBTOTAL                    41,687           79,161           69,487               244,173                                          
-----------------------    ---------------------------------------------------------------                                          

INTEREST FOR FINANCING       8,646           10,029                                                                                 
MANAGEMENT FEES              2,932            2,269                                                                                 

TOTAL (18)                  47,444           90,739           81,785               244,173                                          
-----------------------    ---------------------------------------------------------------                                          


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Notes:                                                                          
(1) Cost of acquisition plus total investment made and/or planned if the project
has not been completed, adjusted for inflation as of 06/30/02, pro-rata to the  
Company's net ownership interest. In the case of the sale of 100% of our        
shareholding interest in Inversora del Pacifico and 50% in Hotel Llao-Llao the  
cost of sale of the shares adjusted for inflation as of 06/30/02 was considered 
as investment cost.                                                             
(2) Total area devoted to sales upon completion of the development or           
acquisition and before the sale of any of the units (including parking and      
storage spaces, but excluding common areas). To obtain the square meters        
attributable to the Company, it should be multiplied by the Company's net       
ownership interest. In the case of Land Reserves the land area was considered.  
(3) Represents the total units or plots upon completion of the development or   
acquisition (excluding parking and storage spaces). To obtain the units or lots 
attributable to the Company, should be multiplied by the Company's net ownership
interest.                                                                       
(4) The percentage sold is calculated dividing the square meters sold by the    
total saleable square meters.                                                   
(5) Includes only cumulative sales adjusted for inflation as of June 30, 2002,  
pro-rata the Company's net ownership interest.                                  
(6) Corresponds to the Company's total consolidated sales as authorized by the  
Comision Naiconal de Valores adjusted for inflation as of 06/30/02. Excludes    
gross income tax deduction.                                                     
(7) Cost of acquisition plus improvement plus activated interest, adjusted for  
inflation as of 06/30/02, pro-rata our Company's net ownership interest.        
(8) Through Alto Palermo S.A. Includes Abasto plots and inventories related to  
the Coto project.                                                               
(9) Through Inversora Bolivar S.A.                                              
(10) Includes the following properties: Dorrego 1916 (fully sold through our    
Company) and units for sale in Alto Palermo Plaza (through Inversora Bolivar)   
(11) Directly through the Company and indirectly through Inversora Bolivar S.A. 
(12) Includes the plots of land of San Jorge Village (fully sold through        
Inversora Bolivar S.A.).                                                        
(13) Through Bs As Trade & Finance S.A.                                         
(14) Through Bs As Realty S.A.                                                  
(15) Through Argentine Realty S.A.                                              
(16) Includes the following land reserves : Torre Jardin IV, Constitucion 1111, 
Padilla 902, and Terreno Pilar (through our Company), and Pontevedra, Mariano   
Acosta, Merlo, Intercontinental Plaza II, Terrenos Benavidez (through Inversora 
Bolivar S.A.) and Terrenos Alcorta (through APSA S.A.).                         
(17) Includes the following properties: Sarmiento 517 (through our Company), 1  
unit of Madero 1020 (through our Company) and Puerto Madero Dock 13, Puerto     
Madero Dock 5, Puerto Madero Dock 6; Av. de Mayo 701, Rivadavia 2768, Serrano   
250; Montevideo 1975 (Rosario) (fully sold through our Company) and Art Tower   
26th Floor and Cervino 3626 (fully sold through Inversora Bolivar S.A.)         
(18) Corresponds to the "Sales and Developments" business unit mentioned in Note
4 to the Consolidated Financial Statements. Excludes gross income tax deduction.

APARTMENT AND LOFT BUILDINGS                                      

      In the apartment building market, we acquire undeveloped properties that
are strategically located in densely populated areas of the city of Buenos      
Aires, particularly properties located next to shopping centers and hypermarkets
or those that are to be constructed. We then develop multi-building high-rise   
complexes targeted towards the middle-income market which are equipped with     
modern comforts and services such as open "green areas," swimming pools, sports 
and recreation facilities and 24-hour security. In the loft buildings market,   
our strategy is to acquire old buildings in disuse that are located in areas    
with a significant middle and upper-income population. The properties are then  
renovated into unfinished lofts allowing buyers the opportunity to design and   
decorate them to their preferences.                                             

TORRES JARDIN, CITY OF BUENOS AIRES. Torres Jardin is a high-rise 
residential complex located in the Buenos Aires neighborhood of Villa Crespo,   
five minutes from Abasto Shopping. The project originally included four 23-story
towers directed towards the middle-income market. However, we had decided not to
construct Torres Jardin IV and sell the rights to do so. Torres Jardin I, II and
III have been completed and consist of 490 one, two and three bedroom           
residential apartments. As of June 30, 2002, Torres Jardin I was 100% sold, II  
98% and III 100%. The complex also includes 295 spaces of underground parking.  

TORRES DE ABASTO, CITY OF BUENOS AIRES. Torres de Abasto is a     
545-apartment high-rise residential apartment complex developed through APSA and
is located one block from Abasto Shopping. The complex consists of three        
28-story buildings and one 10-story building directed towards the middle-income 
market. The apartments were completed in May 1999. The complex has a swimming   
pool, a terrace, 24-hour security, four retail stores on the ground floor of one
of the buildings and 331 underground parking spaces. As of June 30, 2002 99% of 
the apartments were sold.                                                       

  PALACIO ALCORTA, CITY OF BUENOS AIRES. Palacio Alcorta is a 191-loft
residential property that we converted from a former Chrysler factory located in
the residential neighborhood of Palermo Chico, one of the most exclusive areas  
of the city of Buenos Aires, which is a ten minute drive from downtown. The loft
area ranges from 60 to 271 square meters. This project is directed towards the  
upper-income market and it is 100%                                              

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sold. Palacio Alcorta also has seven retail units and 165 parking spaces.       

       CONCEPCION ARENAL 3000, CITY OF BUENOS AIRES. Concepcion Arenal 3000 is a
70-loft residential property located in north-central city of Buenos Aires. Each
loft unit has a salable area of 86 square meters and a parking space. Lofts in  
this building are directed towards the middle-income market.                    

      ALTO PALERMO PARK, CITY OF BUENOS AIRES. Alto Palermo Park is one of two
34-story apartment buildings located two blocks away from Alto Palermo Shopping 
in the exclusive neighborhood of Palermo. Apartments in the building are        
targeted towards the upper-income market. The building is also located next to  
its twin, Alto Palermo Plaza. The buildings are comprised of 3 and 4-room       
apartments with an average area of 158 square meters in the case of Alto Palermo
Park and of 294.5 square meters, in the case of Alto Palermo Plaza and each unit
includes an average of 18 and 29 square meter parking/storage space,            
respectively. These buildings were included in the assets we acquired from Perez
Companc S.A.                                                                    

RESIDENTIAL COMMUNITIES                                           

     In the residential communities market, we acquire extensive undeveloped
properties located in suburban areas or neighborhoods near the city of Buenos   
Aires to develop private neighborhoods and country clubs in which to sell vacant
lots for the construction of single-family homes. In these properties we build  
streets and roads, we arrange for the provision of basic municipal services and 
amenities such as open spaces, sport facilities and security. We seek to        
capitalize on improvements in transportation and communication around the city  
of Buenos Aires, the growing suburbanization of the region and the shift of the 
population moving to countryside-type residential communities.                  

    An important factor in the trend towards living in suburban areas have
been the improvements and additions to the highways Autopista Panamericana,     
Avenida General Paz and Acceso Oeste and the improvement in public train, subway
and bus transportation since their privatization which have greatly reduced     
commuting time and facilitated access.                                          

      As of June 30, 2002, our residential communities for the construction of
single-family homes for sale in Argentina had a total of 218,386 square meters  
of gross salable area in the Abril and Villa Celina IV and V, residential       
communities located in the province of Buenos Aires.                            

ABRIL, HUDSON, GREATER BUENOS AIRES. Abril, is one of our private 
residential communities. It is a 312-hectare property located near the city of  
Hudson, approximately 34 kilometers south of the city Buenos Aires. Abril is    
being developed into a private residential community for the construction of    
single-family homes directed towards the upper-middle-income market. The        
property plan includes 20 neighborhoods subdivided into 1,273 lots consisting of
approximately 1,107 square meters each. Abril also includes an 18-hole golf     
course, 130 hectares of woodlands, a 4,000 square meter mansion and             
entertainment facilities, a bilingual school, horse stables and sports centers  
that were completed by the end of 1998. There is also a community shopping      
center that was finished in 1999. The neighborhoods have been completed and as  
of June 30, 2002, 85% was sold, 102 homes were under construction and 424 homes 
had been completed.                                                             

     On March 23, 2001, we entered into with Pulte S.R.L. a contract for the
sale of plots and a commitment for the transfer of titles of 250 plots from     
Abril to Pulte S.R.L. for a total amount of Ps. 17.4 million. As of June 30,    
2002, there were 44 plots pending to be signed.                                 

       VILLA CELINA, GREATER BUENOS AIRES. Villa Celina is a 400-lot residential
community for the construction of single family homes located in the residential
neighborhood of Villa Celina, on the southeastern edge of the city of Buenos    
Aires, a short distance from the intersection of the Ricchieri highway and the  
avenida General Paz beltway. We have been developing this property in several   
stages since 1994. The first three stages representing 219 lots, each measuring 
347 square meters on average have been completely sold and the two last stages  
representing 181 lots are 99% sold.                                             

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UNDEVELOPED PARCELS OF LAND                                       

    We have acquired large undeveloped properties as land reserves for the
future development of office and apartment buildings, shopping centers and      
single-family housing. We have acquired what we believe to be two of the largest
and most important undeveloped river front parcels in Buenos Aires, Puerto      
Retiro and Santa Maria del Plata, for the future development of residential and 
office spaces. In addition, we have benefited from the improvement of land      
values during periods of economic growth. As of June 30, 2002, our land reserve 
totaled 19 properties consisting of approximately 660 hectares (excluding       
Rosario, Neuquen and Caballito land properties, owned by APSA).                 

CITY OF BUENOS AIRES                                              

      PUERTO MADERO DOCK 3. Plot "5M", located in Dique 3, east side of Puerto
Madero, comprises 20,947 square meters and is subdivided in three plots. The    
plots are owned by three different companies: Buenos Trade & Finance Center S.A.
("BATFCSA"), Buenos Aires Realty S.A. ("BARSA") and Argentine Realty S.A.       
("ARSA"). We own 50% of the capital stock of each of the companies, and the     
other 50% is owned by a company named RAGHSA S.A. ("RAGHSA").                   

     On August 16, 2002, the Company signed an agreement with RAGHSA for the
redistribution of the plot "5M". As a result of the redistribution, the Company 
now owns 100% of the capital stock of BAT&FCSA, and has transferred our 50%     
ownership in ARSA and BARSA, respectively for the benefit of RAGHSA. This       
agreement has also provided the division and redistribution of the costs and    
construction commitments for the sites that had been assumed with Corporacion   
Antiguo Puerto Madero S.A.(CAPM), the adjustment of the remaining commitments   
and obligations also assumed with CAPM and the exchange of the shares issued by 
the mentioned companies owning the plots making up the 5M site, ARSA, BARSA and 
BAT&FCSA, respectively.                                                         

  PUERTO RETIRO. Puerto Retiro is an 8.3 hectare undeveloped riverside
property bounded by the Catalinas and Puerto Madero office zones to the west,   
the transportation hub Retiro to the north and the Rio de la Plata to the south 
and east. One of the only two significant privately owned waterfront properties 
in the city of Buenos Aires, Puerto Retiro may currently be utilized only for   
port activities. We have initiated negotiations with municipal authorities in   
order to rezone the area. Our plan is to develop a 360,000 square meter         
financial center. The launching date has not been settled and consequently, the 
estimated cost and financing method are not decided. We own 66% of our          
subsidiary Inversora Bolivar, who owns a 50% interest in Puerto Retiro.         

       SANTA MARIA DEL PLATA. Santa Maria del Plata is an undeveloped waterfront
property located at the southern end of Puerto Madero, adjacent to the city of  
Buenos Aires nature reserve. Approval has been granted for the construction of  
715,000 square meters. The development will be targeted at the high-income      
market and will include different residential projects, taking advantage of the 
river and related nautical activities. The plan includes three different housing
concepts: high-rise apartment buildings, smaller condominiums and neighborhoods 
of single-family homes. Common areas for recreation, offices, and a hotel are   
also included. We plan to seek a partner for the development of this project. As
of June 30, 2002, we had invested Ps. 74.5 million in Santa Maria del Plata. The
master plan is pending final authorities approval. We currently hope to launch  
this project for sale at the end of fiscal year 2003.                           

       CABALLITO. Caballito is a 2.1 hectare undeveloped property located in the
residential neighborhood of Caballito in the city of Buenos Aires. We are       
considering several alternatives for this property including the development of 
residential apartment complexes or the sale of this property as it is. Zoning   
approvals for the development of residential apartments have been obtained. As  
the plan has not been decided, we do not have an estimated cost and financing   
method for it.                                                                  

       CABALLITO, FERRO PROJECT. It is a property of approximately 25,539 square
meters in the neighborhood of Caballito, in the city of Buenos Aires, which was 
acquired by APSA in October 1998. APSA currently plans to utilize the property  
to build a shopping center similar to Alto Palermo Shopping but at present,     
municipal                                                                       

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zoning regulations do not permit the construction of shopping centers in the    
said property. APSA is analysing the way to get authorization to develop a      
shopping center. There can be no assurance that APSA will actually be able to   
develop this project.                                                           

      ALCORTA PLAZA. On June 29, 2001, APSA acquired a plot of land located in
Figueroa Alcorta avenue, in front of Paseo Alcorta Shopping for Ps. 4.7 million.
This land is located in the neighborhood of Palermo Chico in the city of Buenos 
Aires.                                                                          

      APSA intends to construct an office building named "Alcorta Plaza". This
proposed project will include the construction of a 23-story tower with         
approximately 250 square meters each, which would be sold by story. The proposed
project will also include the construction of a basement level with parking     
spaces. The total estimated cost for the development is currently approximately 
Ps. 9.0 million, which is expected to be financed by anticipated sale of the    
units.                                                                          

       The project's feasibility has been approved by the local authorities, but
final approval is still pending. As a result, APSA cannot assure the approvals  
will be granted, and APSA may decide not to develop this proposed project.      

GREATER BUENOS AIRES                                              

       PEREIRAOLA, HUDSON. We own an 83% interest in Pereiraola S.A., a company,
whose principal asset is a 130 hectare undeveloped property adjacent to Abril.  
We intend to use this property to develop a private community for the           
construction of single-family homes targeted at the middle-income market. We    
have obtained the pertinent municipal building permits. We have not yet         
established the costs and financing method for this proposed project.           

    BENAVIDEZ, TIGRE. Benavidez is a 99.8 hectare undeveloped land reserve
property located in Tigre, 35 kilometers to the north of downtown of the city of
Buenos Aires. The property is easily accessible due to its proximity to         
Panamericana Highway. We are considering several alternatives for this property 
including the development of a residential community or the sale of this        
property as it is and, therefore, we do not have a cost estimate nor a financing
plan.                                                                           

      PILAR. Pilar is a 74.0 hectare undeveloped land reserve property located
close to the city of Pilar, 55 kilometers to the northwest of downtown of the   
city of Buenos Aires. The property is easily accessible due to its proximity to 
the Autopista del Norte. The Pilar area is one of the most rapidly developing   
areas of the country. We are considering several alternatives for this property 
including the development of a residential community or the sale of this        
property as it is and, therefore, we do not have a cost estimate nor a financing
plan.                                                                           

OTHER UNDEVELOPED PARCELS OF LAND IN THE CITY OF BUENOS AIRES     

 Our land reserve property portfolio also includes nine land reserve
properties located in Buenos Aires and its surrounding areas. These properties  
are projected for future developments of offices, shopping centers, apartment   
buildings and residential communities. The principal properties include Puerto  
Madero Dock 4 "block 1M" and Merlo.                                             

OTHER PROVINCES                                                   

   ROSARIO PROJECT, CITY OF ROSARIO, PROVINCE OF SANTA FE. On August 25,
1998, together with Coto our subsidiary APSA acquired a 213,372 square meter    
development property located in the city of Rosario, the third largest city in  
Argentina in terms of population, in a public auction conducted by the Ente     
Nacional de Administracion de Bienes Ferroviarios ("ENABIEF") a Argentine       
government entity within the Ministry of Infrastructure and Housing, dedicated  
to the administration of the national Argentine governments properties          
(subsequently ENABIEF changed its name to Organismo Nacional de Administracion  
de Bienes del Estado -                                                          

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"ONABE"-).                                                                      

    The proposed project is composed of two parts. The first part involves
the construction of a shopping center with approximately 20,000 square meters of
gross leasable area and an entertainment complex, consisting of approximately   
21,000 square meters, that is currently expected to include a science museum, a 
railroad museum, a convention center, a restaurant area and an outside          
entertainment area. The second part involves the construction of a high-rise    
1,200 apartment residential complex consisting of nine towers. APSA paid US$    
17,5 million (net of expenses at the end) for the 66,67% of the property.       

      On December 17, 1999, APSA obtained an exclusive title to a part of this
property upon which it plans to develop a residential complex. On the rest of   
the land, which is 56% owned by APSA and 44% by Coto, APSA plans to develop a   
shopping center.                                                                

At present, the estimated cost of the first part of the project is
approximately Ps. 37.5 million. The estimated cost of completion of the nine    
residential towers is currently estimated at approximately an additional Ps.    
126.0 million.                                                                  

       The ownership of the acquired property is subject to the accomplishment
of a construction timetable.                                                    

       On December 20, 2000, APSA filed a request for extension of the terms set
forth in the original timetable for the construction of the project, which was  
approved by the ONABE by Order 747-01 on September 4, 2001. The extension,      
establishes the following schedule: i) the road system, which construction was  
completed in March 2002; ii) the construction of the shopping center, is        
projected to start on September, 15, 2002; and iii) the construction of the     
first tower of the residential complex is projected to start on March, 2004.    

     On July 10, 2002, APSA submitted a new request for the extension of the
terms established in the last schedule to be approved . This request was        
grounded mainly on the current economic and social crisis affecting the country 
that was absolutely unforeseeable at the time the bid for the purchase of the   
site was made.                                                                  

   At the present date the request to the ONABE is still awaiting reply.

   NEUQUEN PROJECT, PROVINCE OF NEUQUEN. On July 6, 1999, our subsidiary
APSA acquired a 94.6% interest in Shopping Neuquen S.A. for Ps. 4.2 million.    
Shopping Neuquen is owner of a plot of land of approximately 50,000 square      
meters in Neuquen City, which have the pre-approved for the construction of a   
shopping center. APSA paid Ps. 0.9 million on August 20, 1999, the remaining Ps.
3.3 was scheduled to be payable on the earlier of the opening of the shopping   
center and July 5, 2001.                                                        

Shopping Neuquen's sole asset comprises of a piece of land of     
approximately 50,000 square meters with preliminary governmental approval for   
construction of a shopping center on the site. The project contemplates         
construction of a shopping center with 135 stores, a hypermarket, a multiplex   
movie theater and a hotel. The total cost for APSA is currently estimated to be 
approximately Ps. 20.0 million and will be financed with working capital and    
additional bank loans.                                                          

      In June, 2001, Shopping Neuquen filed a request with the municipality of
Neuquen for extension of the original construction timetable and for            
authorization to sell part of the land to third parties for the construction by 
them of the property that they will develop. The proposed new timetable         
contemplates that the construction of the first stage would start on December   
15, 2002 and would finish on December 31, 2004. The second optional stage would 
be finished on December 31, 2006.                                               

      The extension will have to be approved by the Consejo Deliberante of the
city of Neuquen which is the municipal legislative body. APSA is currently in   
the process of seeking to extend the term for construction and payment of the   
remaining purchase price of Shopping Neuquen. In the event that the proposal is 
not                                                                             

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accepted by the local governmental authorities, the sale may be cancelled, and  
Shopping Neuquen may not recover its original investment. Although APSA is      
hoping for a favorable resolution to our proposal, there can be no assurance as 
to the final outcome of the negotiations.                                       

HOTELS                                                            

      At the end of the 1997 fiscal year, we acquired the Hotel Llao Llao, our
first luxury hotel. Some months later, as part of the acquisition from Perez    
Companc of the Old Alto Palermo, we acquired an indirect 50% interest in the    
Hotel Inter-Continental in Buenos Aires which we own through our subsidiary     
Inversora Bolivar. In March 1998, we acquired the Hotel Libertador. During      
fiscal year 1999, we sold a 20% interest in the Hotel Libertador to Hoteles     
Sheraton de Argentina S.A.C. ("Hoteles Sheraton de Argentina") and during the   
fiscal year 2000, we sold 50% of our interest in the Hotel Llao Llao to the     
Sutton group.                                                                   

The following chart shows certain information regarding our luxury
hotels:                                                                         

 HOTELES

                                                        [Enlarge/Download Table]


       HOTEL         ACQUISITION  IRSA'S    ROOMS    AVERAGE   AVG. PRICE   ACCUMULATED SALES FOR FISCAL YEAR      BOOK     
                        DATE      INTEREST         OCCUPATION   PER ROOM   YEAR ENDED JUNE 30 (PS. 000) (1)      VALUE AS   
                                                                                                                 OF JUNE    
                                                                                                                30 2002 (2) 
                                     %                  %         PS.       2002         2001         2000       (PS. 000)  
----------------------------------------------------------------------------------------------------------------------------
                                                                                                                            
Llao Llao               6/97       50        158       53        204        8,186       8,453       17,136       12,906     
Inter-Continental      11/97       50        312       40        168       10,431      16,335       22,262       33,023     
Sheraton Libertador     3/98       80        200       52        149       10,846      16,083       19,668       30,365     
                                             ---       --        ---       ------      ------       ------       ------     
   TOTAL                                     670       48        174       29,463      40,871       59,066       76,294     
--------------------------------------------------------------------------------------------------------------------------- 

 (1)  Proportional to the Company's actual interest for each period.
    (2)  Represents  100% of the hotel's book value  including  facilities
and goodwill.  Proportional  to the Company's interest. 

    HOTEL LLAO LLAO, SAN CARLOS DE BARILOCHE, PROVINCE OF RIO NEGRO. Hotel
Llao Llao is located on the Llao Llao peninsula, 25 kilometers from the city of 
San Carlos de Bariloche, and is one of the most important tourist hotels in     
Argentina. Surrounded by mountains and lakes, this hotel was designed and built 
by the famous architect Bustillo in a traditional alpine style and first opened 
in 1930. The hotel was renovated between 1990 and 1993. The building has a total
constructed surface area of 15,000 square meters, 147 rooms and 14 suites. The  
hotel-resort also includes an 18-hole golf course, tennis courts, health club,  
spa, game room and swimming pool. The hotel is a member of The Leading Hotels of
the World and is currently being managed by Compania de Servicios Hoteleros S.A.
which manages the Hotel Alvear, a luxury hotel located in the Recoleta          
neighborhood of the city of Buenos Aires.                                       

       HOTEL INTER-CONTINENTAL, CITY OF BUENOS AIRES. Hotel Inter-Continental is
located in the downtown city of Buenos Aires neighborhood of Monserrat, adjacent
to the Inter-Continental Plaza office building. This property was also a part of
the acquisition of Old Alto Palermo from Perez Companc. The hotel's meeting     
facilities include eight meeting rooms, a convention center and a divisible 569 
square meter ballroom. Other amenities include a restaurant, a business center, 
a spa and a fitness facilities with swimming pool. The hotel was completed in   
December 1994 and has 314 rooms. The hotel is managed by the Inter-Continental  
Hotels Corporation, a United States Corporation.                                

HOTEL SHERATON LIBERTADOR, CITY OF BUENOS AIRES. Hotel Sheraton   
Libertador is located in downtown city of Buenos Aires at the corner of the     
streets Cordoba and Maipu, one block from Galerias Pacifico. The hotel contains 
193 rooms and 7 suites, eight meeting rooms, a restaurant, a business center, a 
spa and fitness facilities with a swimming pool. In March 1999, we sold 20% of  
our interest in the Sheraton Libertador Hotel for US$ 4.7 million to Hoteles    
Sheraton de Argentina. The hotel is managed by Sheraton Overseas Management     
Corporation.                                                                    

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INTERNATIONAL REAL ESTATE ACTIVITIES                              

As of June 30, 2001, we participated in an international strategic
alliance in Brazil. In December 2000, we sold to Consultoria Inmobiliaria       
Velutini y Asociados all of our interest in Venezuela Invest Ltd. and Fondo de  
Valores Inmobiliarios, companies through which we held our interests in         
Venezuela. On February 28, 2002, we sold all of our interest in Brazil Realty   
for a total amount of US$ 44.2 million.                                         

       The following chart shows IRSA's strategic alliances as of June 30, 2002.

 STRATEGIC ALLIANCES

                                                        [Enlarge/Download Table]


                  COUNTRY             IRSA'S         RESULTS FOR IRSA AS OF JUNE 30, (1)           BOOK VALUE AS      PARTNER     
                                      SHARE          2002           2001           2000           OF JUNE 30 2002                 
                                                                                                                                  
BRAZIL REALTY     Brazil              0.00          (3,378)        17,040         17,477                 -          Elie Horn     
FVI               Venezuela           0.00             -            542          (10,747)                -          Velutini Group
----------------------------------------------------------------------------------------------------------------------------------
TOTAL                                               (3,378)        17,582          6,730                 -                        
----------------------------------------------------------------------------------------------------------------------------------

(1)  The Company's proportional equity value in the period's results.           

BRAZIL REALTY                                                     

Until February 2002, when we sold our subsidiary Brazil Realty, we
participated in the Brazilian real estate market through Brazil Realty which was
engaged in: a) the acquisition and operation of office and shopping center      
properties for rental, and b) the acquisition and development of properties, and
vacant land, to be used as office and retail properties for rental and/or sale, 
and as residential properties for sale. Brazil Realty primarily focuses its     
activities in the Sao Paulo real estate market, Brazil's largest consumer and   
industrial market.                                                              

     At the time we sold Brazil Realty, we owned 49,3% of the voting capital
stock of Brazil Realty, through our wholly owned subsidiary Ritelco S.A. Brazil 
Realty's shares are listed and traded on the Sao Paulo Stock Exchange and trade 
in the over-the-counter market in the United States in the form of American     
Depositary Shares (NASDAQ symbol: BRZD).                                        

FONDO DE VALORES INMOBILIARIOS                                    

In December 2000, we sold to Consultoria Inmobiliaria Velutini y  
Asociados all of our interest in Venezuela Invest Ltd. and Fondo de Valores     
Inmobiliarios, companies through which we held our interests in Venezuela, for  
total consideration of US$ 67.0 million.                                        

   Loss from the sale was US$ 0.494 million, and was recorded as part of
operating income under the line item "Loss from operations and holdings of real 
estate assets".                                                                 

TECHNOLOGY INVESTMENTS IN LATIN AMERICA                           

LATIN AMERICAN ECONETWORKS N.V.                                   

      In July 2000, together with Divine InterVentures, Inc., Dolphin Fund Plc
(formerly Quantum Dolphin Plc) and Catanzaro Holding B.V., we formed Latin      
American Econetworks N.V., a holding company organized in the Netherlands       
Antilles ("LAE"). LAE was conceived as a developer of software, technology and  
Internet-related information network for the technology service suppliers. In   
connection with the formation, an 11.2% interest in the holding company was     
issued to us in exchange for US$ 5.3 million in cash.                           

      On November 7, 2001, we sold our ownership in Latin American Econetworks
for Ps. 5.2 million.                                                            

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IRSA TELECOMUNICACIONES N.V.                                      

In the fourth quarter of fiscal year 2000, we had invested US$ 3.0
million, -in the form of irrevocable capital contributions-, into two unrelated 
companies, namely, Red Alternativa, a provider of satellite capacity to Internet
service providers, and Alternativa Gratis, an Internet service provider (the    
"Companies"). At that date, the Companies were development stage companies with 
no significant operations. Between July 2000 and August 2000, we, together with 
Dolphin Fund Plc (formerly Quantum Dolphin Plc), increased our respective       
investments in the Companies, in exchange for shares of common stock. In a      
series of transactions, which occurred between August 2000 and December 2000,   
(i) we formed IRSA Telecomunicaciones N.V. ("ITNV"), a holding company organized
under the laws of the Netherlands Antilles, for the purposes of completing a    
reorganization of the Companies and (ii) Dolphin Fund Plc (formerly Quantum     
Dolphin Plc), the previous majority shareholder of the Companies and us         
contributed our respective ownership interest in the Companies into ITNV in     
exchange for shares of common stock of ITNV. As a result of the reorganization, 
the Companies are now wholly owned subsidiaries of ITNV. Following the          
reorganization, we held a 49.36% interest in ITNV and Dolphin Fund Plc. held a  
20,13% interest.                                                                

On December 27, 2000, the shareholders of ITNV entered into a     
shareholders agreement with new investors in ITNV, namely Quantum Industrial    
Partners LDC and SFM Domestic Investment LLC, under which such new investors    
contributed US$ 4.0 million in cash in exchange for 1,751,453 shares of Series A
redeemable convertible preferred stock and an option to purchase 2,627,179      
additional shares of mandatorily redeemable convertible preferred stock.        
Pursuant to the terms of the shareholders agreement, options were granted for a 
period up to five years and at an exercise price equal to the quotient of US$   
6.0 million by 2,627,179 preferred shares. On or after December 27, 2005, ITNV  
might be required, at the written request of holders of the then outstanding    
Series A preferred stock to redeem such holders' outstanding shares of series A 
preferred stock for cash at the greater of (i) 200% of the original issue price 
multiplied by the number of preferred stock to be redeemed, and (ii) the fair   
market value of the common shares each holder of Series A preferred stock would 
have been entitled to receive if such holder had converted the number of Series 
A preferred stock to be redeemed into common stock at the redemption date; in   
both cases plus any accrued or declared but unpaid dividends.                   

ALTOCITY.COM                                                      

  Altocity.Com, is a company engaged in delivering e-commerce services
providing customers with the information necessary to make personalized online  
buying decisions and giving retailers the ability to reach a large customer     
base. Altocity.Com, is a wholly owned subsidiary of E-Commerce Latina S.A.,     
("E-Commerce Latina"), an Internet venture between APSA and Telefonica de       
Argentina S.A. ("Telefonica"), where each of them have a 50% interest.          
Previously, APSA's partner in the venture was Telinver S.A., a wholly owned     
subsidiary of Telefonica; but on April 27, 2001, Telinver notified APSA that it 
had transferred its holdings in E-commerce Latina to Telefonica.                

     Altocity.Com's goal is to make the shopping experience informed, quick,
interactive and personalized. Altocity.Com primarily derives its revenues from  
sales of products on its website and to a lesser extent from sales of           
advertising and sponsorships and a fixed amount charged to retailers.           

    Altocity.Com began operating its web site on June 1, 2000, and by June
30, 2002, had more than 30,000 registered users. The site offers a product      
supply of approximately 320,000 items from over 66 retailers that are classified
into 16 categories such as apparel, books, music and home appliances. The site's
"url address" www.altocity.com, is visited monthly by approximately 84,077      
visitors on average.                                                            

    In connection with the formation of E-Commerce Latina, on December 15,
1999, APSA entered into a shareholders' agreement with Telinver. On April 27,   
2001, Telinver notified APSA that it had assigned that agreement to Telefonica. 
Pursuant to the shareholders agreement, Telinver contributed to E-Commerce      
Latina US$ 5 million upon execution, and an additional US$ 5.0 million on June  
15, 2000 in return for its 50% ownership position. APSA contributed intellectual
property rights in exchange for its 50% ownership interest.                     

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APSA and Telinver made additional capital contributions of US$ 5 million each,  
during April 2001, and agreed to make optional capital contributions to be      
approved by E-Commerce Latina's board of directors of up to US$ 12.0 million to 
develop new lines of business, of which 75% is to be contributed by Telinver and
25% is to be contributed by APSA.                                               

       The shareholders' agreement also sets forth the rights and obligations of
each party over the operation of E-commerce Latina. The significant provisions  
of the shareholders agreement include:                                          

    o    our obligation to remain as APSA's controlling shareholder and of
Grupo Telefonica to control Telinver or any successor;  

   o    the determination of the election of the members of the board of
directors;                                              

o    terms for notices of the shareholders meetings; and          

       o    certain restrictions on transfers of shares for the first two years,
       and thereafter reciprocal first refusal and "tag along" rights.

POLICIES WITH RESPECT TO CERTAIN ACTIVITIES                       

      The following is a discussion of our investment objectives and policies,
financing policies and policies with respect to certain other activities. These 
policies may be amended or revised from time to time at the discretion of our   
board of directors without the approval of our stockholders.                    

INVESTMENT OBJECTIVES AND POLICIES                                

We intend to achieve our objectives by means of:                  

      o    the acquisition and development of residential properties primarily
for sale,                                               

 o    the acquisition, development and operation of office and other
            non-shopping center retail properties primarily for rental purposes,

o    the acquisition, development and operation of shopping center
properties,                                             

o    the acquisition and operation of luxury hotels, and          

      o    the acquisition of undeveloped land reserves for future development
or sale.                                                

 Our strategy is to increase our cash flow, revenues and asset value
through the continuous expansion of our diversified portfolio of properties and 
assets by means of the purchase, development and operation of real property,    
either individually or in association with third parties, in all our business   
segments.                                                                       

We may change our current policy regarding any of these activities
without the need for a vote from the securities holders.                        

Throughout the past three years the rental of office and retail   
properties have been our main activities, whereas the acquisition and           
development of residential properties for sale and the operation of luxury      
hotels have become secondary activities as a result of the economic recession.  
We have made no acquisitions of undeveloped land reserves during this period.   

   Going forward, we expect to continue to focus on rental activities of
both office and retail space as main activities, while we believe we will not   
continue with the development of residential properties for sale until we see   
clear signs of a recovery in the Argentine economy. The operation of luxury     
hotels will probably remain a secondary activity.                               

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     Historically, the acquisition of undeveloped land reserves has been the
only activity in which the main objective was to obtain capital gains, while the
rest of our business segments are mostly income producing activities.           
Nevertheless, in the past, we have sold, and we expect to continue selling in   
the future, properties which belong to other business segments, with the        
intention of producing a capital gain.                                          

   We originate mortgage loans to stimulate the sale of units within our
development projects. Most of this mortgage portfolio was sold in December 2001,
but we have granted a small number of new loans subsequent to that date.        

     We may purchase rental properties for long-term investment or sell such
properties, in whole or in part, when it is advisable according to the          
circumstances. In addition, we may purchase properties for development and sale 
in whole or in part when it is advisable according to the circumstances. We do  
not have a policy with respect to particular holding periods for our properties 
and may dispose of them in whole or in part at any time we deem appropriate. We 
have and may continue to invest in real estate through subsidiary corporations  
or participate with other Argentine or foreign entities in property ownership   
through strategic alliances or other types of co-ownership entities that we may 
or may not control. We currently contemplate acquiring additional properties    
located in Argentina and other countries in Latin America through strategic     
alliances.                                                                      

  In the past, we have not invested in mortgage pools nor have sold or
transferred to third parties our loans secured by mortgages pursuant to our     
seller financing programs for purchasers of units in our development properties.
However, in light of the recent development of the legal framework for the      
secondary market for mortgages in Argentina, there can be no assurance that we  
will not engage in this type of transaction in the future.                      

   We have in the past and may in the future make secured loans to third
parties in connection with our real estate operations.                          

FINANCING POLICIES                                                              

         In the past we have obtained financing by means of share offerings, the
use of fixed and variable rate debt instruments and short-term credit lines. We 
may in the future incur additional indebtedness whenever the board considers it 
appropriate. Management expects that additional financing could be necessary,   
and will be obtained through a combination of the methods listed above or       
through other types of financing, such as mortgages and the issue of debt       
instruments backed by assets. See "Operating and Financial Review and Outlook - 
Liquidity and Capital Resources".                                               

  Our short term financing policy will be focused on obtaining the
refinancing of our foreign current liabilities, extending the terms of          
maturities and lowering interest rates, rebuilding our working capital and      
substantially improving our financial burden                                    

OTHER POLICIES                                                                  

         We have issued and may issue senior debt securities. See "Operating and
Financial Review and Outlook - Liquidity and Capital Resources". We may also    
invest in debt securities or shares in other entities not involved in real      
estate. In the last four years we have not issued securities in exchange for    
property. Between the months of January and March 1999, we purchased 2,432,932  
of the Company's outstanding shares, and between May and October 2000 we        
acquired 20,729,472 of our own shares. Shareholder's meetings held on October   
28, 1999 and October 30, 2000 approved the distribution of this shares. In      
addition, between November 2000 and January 2001 we acquired 4,587,285 Company  
shares, which are at present held in portfolio. Currently we have no plans to   
repurchase own shares, unless it is determined to be beneficial to our          
shareholders, and as long as the market conditions guarantee such an action in  
the context of that allowed by our by-laws, legislation and applicable          
regulations.                                                                    

DIVIDEND POLICY                                                                 

Pursuant to Argentine law, the distribution and the payment of
dividends to shareholders is valid only if it results from realized and net     
earnings of the company pursuant to annual financial statements approved by     

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the shareholders. The board of directors may declare interim dividends, in which
case each board member and member of the Supervisory Committee will be severally
responsible for the return of such dividends if at the end of the fiscal year in
which such interim dividends were paid the realized liquid profits were to be   
insufficient to allow the payment of such dividends. The approval , amount and  
payment of dividends are subject to the approval of our shareholders at our     
annual general meeting. In view of their ability to exercise significant        
influence over the selection of board members, our principal shareholders have  
the power to control the declaration, amount and payment of dividends, subject  
to Argentine legislation and our Company's by-laws.                             

      The board submits the annual report and balance sheet of the Company for
the previous fiscal year together with the reports from the Supervisory         
Committee for the approval of the annual general meeting of shareholders. The   
annual ordinary shareholders' meeting called to approve the annual report and   
financial statement and to determine the distribution of the Company's net      
income for the year must be held prior to October 30 each year. In accordance   
with Argentine law and our bylaws, liquidated and realized profits for each     
fiscal year are distributed as follows:                                         

     - 5% of such net profits are allocated to our legal reserve, until such
reserve amounts to 20% of our capital stock;                                    

      - a certain amount determined at a shareholders' meeting is allocated to
the compensation of our directors and the members of our supervisory committee; 
and                                                                             

 - dividends, additional dividends to preferred shares if any, or to
optional reserve funds or contingency reserves or to a new account, or for      
whatever purpose the shareholders' meeting determines are distributed.          

 According to the rules issued by the Argentine Comision Nacional de
Valores, cash dividends must be paid to shareholders within 30 days of the      
resolution approving their distribution. In the case of stock dividends, the    
shares must be delivered within three months of the holding of the annual       
general meeting that were to have approved them.                                

 If and when our Company declares and pays dividends on its ordinary
shares, the holders of global share certificates in the Company, each           
representing the right to receive 10 ordinary shares (the "GDS") at the         
corresponding registration date shall have the right to receive the dividends   
due on the ordinary shares underlying the GDSs subject to the term of the       
Modified Ordered Deposit Contract dated December 12, 1994, signed between our   
Company, The bank of New York and the eventual holders of the GDSs. Cash        
dividends are to be paid in pesos, and except in certain circumstances they will
be converted by the Depository into dollars at the rate of exchange in force at 
the date of conversion and shall be paid to the holders of the GDSs net of any  
commission on the distribution of dividends, costs and conversion charges, taxes
and official dues.                                                              

     In the past, we paid dividends in cash and stock that averaged Ps. 0.11
per share. At our shareholders' meeting which was held on October 30, 2000, our 
shareholders approved the distribution of 20,729,472 treasury shares to be      
distributed pro rata among our shareholders.                                    

      The following table sets forth the dividend payout ratio and the amounts
of total dividends paid on each fully paid share common stock in respect of the 
year indicated. Amounts in Pesos are presented in historical Pesos of the       
respective payment dates. See "Exchange Rates".                                 

                                                        [Enlarge/Download Table]

                                         PAYMENTS (1)                                          
       YEAR DECLARED       CASH DIVIDENDS            STOCK DIVIDENDS          TOTAL PER SHARE  
-------------------------  --------------        ---------------------     --------------------
                              (Pesos)                    (Pesos)                  (Pesos)      
                                                                                               
1995.....................       0.094                      0.06                     0.154      
1996.....................       0.092                        --                     0.092      
1997.....................       0.110                        --                     0.110      
1998.....................       0.060                      0.05                     0.110      
1999.....................       0.076                      0.04                     0.116      

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2000.....................          --                      0.20                     0.204      
2001.....................          --                        --                        --      


----------                                                                      
(1)    Corresponds to per share payments. To calculate the dividends paid per   
GDS, the payment per share should be multiplied by ten.           

   During the fiscal year ended June 30, 2001, we suffered a loss of Ps.
59.9 millions. Consequently, in order to maintain adequate liquidity levels, to 
reduce our outstanding debt and our financial burden, we did not pay any cash   
dividends.                                                                      

 Under certain of our debt obligations, we have specific limitations
regarding the distribution of dividends. In accordance with our syndicated      
credit facility for US$ 80 million, neither we nor our subsidiaries are able to 
pay dividends or make any other distribution or debt or equity repurchase,      
except for certain restricted subsidiary payments to us. Restricted payments can
be made only if no event of default has occurred, or would occur as a result of 
such payment, and no financial covenants have been violated during the prior    
calculation period. Moreover, as agreed upon the issuance of the floating rate  
notes, if we do not fulfill any of our obligations, neither we nor our          
subsidiaries will be able to pay dividends in cash directly or indirectly       
through payments of bonds, compensation, loans, forgiveness of debt, or any     
other distribution, in money or kind, to shareholders, or fees to directors,    
except that our subsidiaries may distribute dividends to us, to be used to pay  
off the floating rate notes.                                                    

   During fiscal year ended June 30, 2002 we had a net loss of Ps. 499.6
million. Consequently, we currently intend to maintain the same policy as last  
year, to be discussed at our next shareholder's meeting, to distribute no       
dividends unless and until we return to profitability.                          

    Although we hope to distribute cash dividends in the future, we cannot
assure that we will be able to do so.                                           

TAKING OF DECISIONS AND INTERNAL CONTROL OF THE COMPANY           

Pursuant to our bylaws, our day-to-day business is managed by an  
executive committee consisting of five directors among which, there should be   
the chairman, first vice-chairman and second vice-chairman of the board of      
directors                                                                       

The executive committee is responsible for the management of the  
day-to-day business delegated by the board of directors in accordance with      
applicable law and our bylaws. Our bylaws authorize the executive committee to: 

      o    designate the managers and establish the duties and compensation of
such managers;                                          

o    grant and revoke powers of attorney on behalf of us;         

    o    hire, discipline and fire personnel and determine wages, salaries
and compensation of personnel;                          

o    enter into contracts related to our business;                

o    manage our assets;                                           

  o    enter into loan agreements for our business and set up liens to
secure our obligations; and                             

      o    perform any other acts necessary to manage our day-to-day business.

   The supervisory committee (Comision Fiscalizadora) is responsible for
reviewing and supervising our administration and affairs, and verifying         
compliance with the bylaws and the resolutions adopted at shareholders'         
meetings. See "Management and Administration".                                  

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 SUBSEQUENT EVENTS

    The following events have taken place subsequent to June 30, 2002, the
year-end closing date.                                                          

       SALE OF MADERO 1020 OFFICES - On July 31, 2002 the Company sold floor
21 located at the office tower of Madero 1020 for an amount of US$ 410,000, paid
in the form of Ps.1,488,300. On August 2, 2002 the Company sold floor 15 for an 
amount of US$ 400,000 and on August 29, 2002 the Company sold floor 23 for an   
amount of US$ 365,000, both floors located in this same building.               

 EXCHANGE AND PERMUTATION OF SHARES IN COMPANIES ARSA, BARSA AND
BAT&FCSA.- On August 16, 2002, the Company signed an agreement with RAGHSA for  
the distribution of the 5M site within Antiguo Puerto Madero in the City of     
Buenos Aires. The redistribution of costs and construction commitments for the  
sites that had been assumed with Corporacion Antiguo Puerto Madero S.A. (CAPM), 
the adjustments of the remaining commitments and obligations also assumed with  
CAPM and the exchange of the shares issued by the mentioned companies owning the
plots making up the 5M site, ARSA, BARSA and BAT&FCSA, respectively.            

   As a result of this distribution the Company now owns 100% of the
capital stock of BAT&FCSA, while our 50% holding in ARSA and BARSA was          
transferred to RAGHSA S.A.                                                      

         ISSUE OF BONDS CONVERTIBLE INTO ORDINARY SHARES OF APSA - On August 20,
2002, APSA ended its subscription period for the first branch for up to US$ 50  
million of bonds convertible into ordinary shares of APSA of a Ps.0.1 nominal   
value each. In this sense, IRSA has subscribed a total amount of US$ 27.7       
million of the convertible notes of APSA.                                       

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 SELECTED CONSOLIDATED FINANCIAL AND OPERATING INFORMATION

      The following selected consolidated financial data has been derived from
our consolidated financial statements as of the dates and for each of the years 
indicated below. This information should be read in conjunction with and is     
qualified in its entirety by reference to our consolidated financial statements.

                                                        [Enlarge/Download Table]


                                             AS OF AND FOR THE YEAR ENDED JUNE 30, (1)
                                             -----------------------------------------
                                                  2002                      2001      
                                             -----------------       -----------------
                                                                                      
                                             $                         $              
Sales                                            211,319                     339,843  
Costs                                           (121,355)                   (172,024) 
Gross profit                                      89,964                     167,819  
Selling expenses                                 (34,332)                    (33,748) 
Administrative expenses                          (37,643)                    (50,740) 
Loss on purchasers rescissions of sales                                               
   contracts                                          27                         (14) 
(Loss) gain from operations and holdings of                                           
   real estate assets, net                       (64,956)                     (6,305) 
Operating income                                  46,940                      77,012  
Net (loss) income in equity investments.          (1,967)                    (10,323) 
Financial results, net                          (432,220)                   (103,302) 
Other income (expenses), net                      (8,511)                     (5,624) 
(Loss) income before taxes, preacquisition                                            
   earnings and extraordinary items             (489,638)                     49,237  
Income tax                                        (9,981)                     (5,063) 
Net (loss) income ordinary                      (499,619)                     54,300  
Extraordinary loss                                     -                      (5,653) 
Net (loss) income                               (499,619)                    (59,953) 
Net (loss) income per share                        (2.41)                      (0.29) 
Net (loss) income per GDS                         (24.08)                      (2.89) 

BALANCE SHEET DATA                                                                    
Cash and current investments                      61,627                     100,237  
Inventories                                       70,688                      92,182  
Mortgages and leases receivable, net              15,139                     104,254  
Total current assets                             136,308                     221,875  
Non-current investments                          526,348                     699,893  
Fixed assets, net                                338,794                     419,375  
Total assets                                   1,144,715                   1,494,549  
Short-term debt (2)                              565,572                     352,091  
Total current liabilities                        606,060                     385,661  
Long-term debt (3)                                   867                      28,848  
Total non-current liabilities                      3,021                      34,497  
Shareholders' equity                             460,416                     960,035  

OTHER FINANCIAL DATA                                                                  
EBITDA(4)                                         84,436                     120,766  
Depreciation and amortization                     21,033                      23,103  
Capital expenditures(5)                           76,601                      72,755  
Net cash provided by (used in):                                                       
Operating activities                              47,325                      95,894  
Investing activities                             (17,426)                     72,755  
Financing activities                             (37,867)                   (164,648) 


(1)    In thousands of constant Argentine Pesos of June 30, 2002, except for    
ratios and weighted average number of shares outstanding. Includes
    adjustment by inflation as of June 30, 2002. Sums may not total due to
rounding.                                                         
(2)    Includes short-term loans, the current mortgages payable and the current 
portion of the seller financing.                                  
(3)    Includes long-term loans, non-current mortgages payable and the          
non-current portion of the seller financing.                      
(4)    EBITDA is net income plus, when previously deducted, expenses for        
consolidated interest, consolidated income tax, consolidated      
depreciation, consolidates amortization of intangibles and losses 
derived from operations and holdings of real estate and other     
non-monetary items that reduce or increase net income, plus cash  
   dividends received from non-consolidated subsidiaries less any income
derived from the valuation of investments in affiliated companies 
  using the equity method of accounting and minority interests. EBITDA
should not be considered as an alternative to (i) net income as an
    indicator of the Company's operating return, or (ii) the flow of funds
of the operating activities of our Company, as an indicator of    
liquidity. Does not include income from subsidiaries.             
(5)    Includes the purchase of inventories, fixed assets and long-term         
investments.                                                      

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF      
OPERATIONS                                                                      

       The following management's discussion and analysis of financial condition
and results of operations should be read together with the Company's financial  
statements and their notes. For the purposes of the following analysis we have  
considered "Audited Consolidated Financial Statements" to be our audited        
consolidated financial statements and notes corresponding to the fiscal year    
ended June 30, 2002 and 2001.                                                   

VARIABILITY OF QUARTERLY RESULTS                                                

       A principal source of our revenue is rental income derived from leases of
office and retail properties and sales of developed properties. Nevertheless,   
our historical revenues have varied from period to period depending upon the    
timeliness of sales of properties. No assurance can be given that our period to 
period results of operations will not continue to vary as a result of periodic  
property sales.                                                                 

CONSOLIDATION                                                     

    The consolidated statements of income were prepared on a proportionate
consolidation basis. As of July 1, 1996, we have used the                       
"proportionate-consolidation method" of accounting for our investments in which 
we exercise control and other jointly-controlled investments. This method has   
not been used for balance sheet and cash flows purposes. All notes to our       
consolidated financial statements relating to income-statement items have been  
also prepared on a proportionate consolidation basis. We calculate the          
proportionate-consolidation method by applying our percentage ownership interest
to the historical financial statements of our equity method investments. We     
consider this method more appropriately reflect our results of operations and   
the integration of our core businesses. The use of the                          
proportionate-consolidation method has been approved by the Argentine Comision  
Nacional de Valores.                                                            

       Although the use of the proportionate consolidation method as compared to
the equity method of accounting from a financial presentation perspective       
impacts almost all areas of our consolidated statements of income, it does not  
impact our consolidated shareholders' equity or net earnings. Note 14 to the    
consolidated financial statements we presented the income statements in         
accordance with the Technical Resolution N(o) 4 of F.A.C.P.C.E. reporting       
(i) the jointly-controlled investments accounted for by the equity method, with 
the earnings or losses included as earnings or losses from equity investments,  
and (ii) minority interest in earnings or losses of controlled subsidiaries.    

In accordance with the terms of Resolution 3/02 issued by the     
Professional Council in Economic Sciences in the Autonomous city of Buenos Aires
and Resolution 415/02 of the Comision Nacional de Valores the Company's         
financial statements contemplate the effects of changes in the purchasing power 
of the currency as of January 1, 2002.                                          

REVENUE RECOGNITION                                               

     We primarily derive our revenues from domestic and international office
and shopping center leases and services operations, the development and sale of 
properties, hotel operations and to a lesser extent, from e-commerce activities.
The proportionate consolidation method has not been used for balance sheet and  
cash flows purposes. This section reflects our revenue recognition policies and 
those of our controlled and jointly-controlled subsidiaries. All revenues are   
stated net of taxes levied on sales.                                            

      DEVELOPMENT AND SALE OF PROPERTIES. We generally enter into purchase and
sale agreements with purchasers of units in our residential development         
properties prior to the commencement of construction. Pursuant to this practice,
we initiate our marketing and sales efforts on the basis of already-commissioned
architectural designs and model units. As a general rule, purchasers pay a      
booking charge for the units and subsequently enter into fixed price purchase   
and sale agreements by advancing us approximately 5% of the purchase price and  
agreeing to advance an additional 20% of the purchase price in equal            
installments over an agreed upon construction period. The balance of the        
purchase price is due upon delivery of the constructed and completed unit.      

      Construction of such residential development properties is done pursuant
to "turn-key" contracts with major Argentine and South American construction    
companies that provide for construction to be completed                         

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within a prescribed period and budget, subject to customary exceptions.         

     We record revenue from the sale of properties when all of the following
criteria are met:                                                               

o    the sale has been consummated;                               

o    we have determined that the buyer's initial and continuing   
           investments are adequate to demonstrate a commitment to pay for the
property;                                               

o    our receivable is not subject to future subordination; and   

     o    we have transferred to the buyer the risk of ownership, and do not
have a continuing involvement in the property.          

      We use the percentage-of-completion method of accounting with respect to
sales of development properties under construction effected under fixed-priced  
contracts. Under this method, revenue is recognized based on the ratio of costs 
incurred to total estimated costs applied to the total contract price. We do not
commence revenue and cost recognition until such time as the decision to proceed
with the project is made and construction activities have begun.                

      The percentage-of-completion method of accounting requires management to
prepare budgeted costs (i.e., the estimated costs of completion) in connection  
with sales of properties / units. All changes to estimated costs of completion  
are incorporated into revised estimates during the contract period.             

 Under this method of accounting, revenues for work completed may be
recognized in the statement of income prior to the period in which actual cash  
proceeds from the sale are received. In this situation, a deferred asset is     
recorded. Alternatively, and as is more common for us, where property unit      
purchasers pay us an advance down-payment and monthly cash installments prior to
the commencement of construction, a liability is recorded. This is recorded as a
customer advance in the financial statements.                                   

      LEASES AND SERVICES FROM OFFICE AND OTHER BUILDINGS. Leases with tenants
are accounted for as operating leases. Tenants are charged a base rent on a     
monthly basis. Rental income is recognized on a straight-line basis over the    
term of the lease and unpaid rents are included in accounts receivable in the   
consolidated balance sheets.                                                    

      LEASES AND SERVICES FROM SHOPPING CENTER OPERATIONS. Leases with tenants
are accounted for as operating leases. Tenants are generally charged a rent     
which consists of the higher of (i) a monthly base rent and (ii) a specified    
percentage of the tenant's monthly gross retail sales which generally ranges    
between 4% and 8% of tenant's gross sales. Furthermore, pursuant to the rent    
escalation clause in most leases, a tenant's base rent generally increases      
between 4% and 7% each year during the term of the lease. Minimum rental income 
is recognized on a straight-line basis over the term of the lease and unpaid    
rents are included in accounts receivable in the consolidated balance sheets.   

       Certain lease agreements contain provisions which provide for rents based
on a percentage of sales or based on a percentage of sales volume above a       
specified threshold. We determine the compliance with specific targets and      
calculate the additional rent on a monthly basis as provided for in the         
contracts. Thus, these contingent rents are not recognized until the required   
thresholds are exceeded.                                                        

 Generally, our lease agreements vary from 36 to 120 months. Law No.
24,808 provides that tenants may rescind commercial lease agreements after the  
initial six months, upon not less than 60 days' written notice, subject to      
penalties which vary from one to one and a half months rent if the tenant       
rescinds during the first year of its lease, and one month of rent if the tenant
rescinds after the first year of its lease.                                     

     We also charge our tenants a monthly administration fee, prorated among
the tenants according to their leases, which varies from shopping center to     
shopping center, relating to the administration and maintenance of              

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the common area and the administration of contributions made by tenants to      
finance promotional efforts for the overall shopping centers operations.        
Administration fees are recognized monthly when earned. In addition to rent,    
tenants are generally charged "admission rights", a non-refundable admission fee
that tenants may be required to pay upon entering into a lease and upon lease   
renewal. Admission right is normally paid in one lump sum or in a small number  
of monthly installments. Admission rights are recognized using the straight-line
method over the life of the respective lease agreements. Furthermore, the lease 
agreements generally provide for the reimbursement of real estate taxes,        
insurance, advertising and certain common area maintenance costs. These         
additional rents and tenant reimbursements are accounted for on the accrual     
basis.                                                                          

    CREDIT CARD OPERATIONS. Revenues derived from credit card transactions
consist of commissions and financing income. Commissions are recognized at the  
time the merchants' transactions are processed, while financing income is       
recognized when earned.                                                         

   HOTEL OPERATIONS. We recognize revenues from our rooms, catering, and
restaurant facilities as earned on the close of business each day.              

      INTERNATIONAL OPERATIONS. On February 28, 2002, we sold all of our 49.3%
interest in Brazil Realty, a company operating in Brazil, whose business        
primarily comprises the same type of operations conducted by us in Argentina.   

All revenues are state net of taxes levied on sales.              

RENTAL PROPERTY DEPRECIATION                                      

      We compute depreciation using the straight-line method over an estimated
useful life of 50 years for buildings, ten years for facilities and five years  
for furniture and other equipment, all of which are judgmental determinations.  
These determinations may prove to be different than the actual life of the      
properties.                                                                     

EFFECT ON US OF RECENT DEVALUATION AND ECONOMIC CRISIS            

All of our assets are located and our operations are performed in 
Argentina. Accordingly, our financial condition and results of operations depend
substantially upon economic conditions prevailing in Argentina. Due to a        
four-year-old recession, the Argentine economy has deteriorated sharply.        

 The rate of gross domestic product growth of Argentina dropped to a
negative 5.0% during the first two quarters of 2001 and dropped to a negative   
16% during the first quarter of 2001. In May 2002, unemployment rate rose to    
22.0%. Other relevant economic indicators have not been showing signs of        
recovery. In conclusion, the economic crisis, the lower level of activity in the
Argentine economy and the increase in the unemployment rate during all the      
fiscal year have detrimentally affected our profitability.                      

On December 23, 2001, President Adolfo Rodriguez Saa declared the 
suspension of the payment of foreign debt and later Eduardo Duhalde ratified    
this decision. On January 7, 2002, the National Congress enacted the Public     
Emergency Law which repeals several provisions of the Convertibility Law which  
prevailed in Argentina for 10 years, and the executive branch announced the     
devaluation of the Peso with the establishment of a dual exchange rate system in
which certain limited transactions will occur at a fixed rate of Ps. 1.4 to US$ 
1.0 and all other transactions will be settled at a floating market rate        
depending on supply and demand. This new legislation is expected to have a      
material adverse impact on our financial position and the results of our        
operations. Our board of directors is currently analyzing the impact of the new 
legislation and has begun conversations with our creditors for renegotiations of
existing agreements. Additionally, we will initiate negotiations with tenants   
regarding the terms of our lease agreements as called for in the new            
legislation.                                                                    

       As described above, economic and political factors affecting Argentina as
well as changes in interest rates and foreign currency have a substantial impact
on our financial performance. We have been negatively                           

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impacted by the continued deterioration of the Argentine economy, the Argentine 
government's adoption of the economic measures summarized above and the         
devaluation of the Argentine Peso. During fiscal year 2002, we suffered a net   
loss of Ps. 499.6 million and as of June 30, 2002, we have a working capital    
deficiency of Ps. 469.8 million. Additionally, we are not in compliance with    
certain restrictive covenants under our syndicated credit facility and our      
floating rate notes, conditions which constitute events of default and permit   
the holders of such notes to accelerate their maturity. Due to the continuing   
effects of economic recession, the unavailability of financial credit and the   
succession of recent economic measures adversely affecting the normal operations
of the banking and payments system, we were unable to make the schedule payments
upon maturity of our floating rate notes and our syndicated credit facility on  
September 9, 2002 and July 31, 2002. Our management has successfully negotiated 
with the holders of our floating rate notes and the lenders under our syndicated
credit facility to extend both maturities to September 30, 2002.                

EFFECTS OF INFLATION                                              

 From 1997 until the end of year 2001, policies adopted by Argentine
government have substantially reduced the level of inflation. Therefore,        
inflation has not affected our financial condition and results of operations.   
The following are annual inflation rates' figures published by the Ministry of  
Economy of Argentina:                                                           

          YEAR ENDED JUNE 30,     CONSUMER PRICE INDEX     WHOLESALE PRICE INDEX
     ------------------------     --------------------     ---------------------
1997                                 0.9%                      0.1%   
1998                                 1.1%                     -1.9%   
1999                                -1.4%                     -5.3%   
2000                                -1.2%                      4.4%   
2001                                -0.3%                     -1.6%   
2002                                30.5%                     95.6%   

       The Public Emergency Law authorizes the executive branch to establish the
system which will determine the new exchange ratio between the Peso and foreign 
currencies, and to approve the corresponding monetary regulations. The          
devaluation of the Peso by the executive branch creates a significant risk that 
inflation will increase materially, and we have no means of hedging and         
protecting ourselves from the risks of inflation.                               

EFFECTS OF INTEREST RATE FLUCTUATIONS                             

  We are highly leveraged and are materially affected by interest rate
fluctuations. Almost all of our U.S. dollar-denominated indebtedness bears      
variable interest rates that have increased substantially during the year 2001. 
An increase in interest rates may significantly increase our financial costs and
materially affect our financial condition and our results of operations.        

EFFECTS OF FOREIGN CURRENCY FLUCTUATIONS                          

     From April 1, 1991, until the beginning of 2002, the Convertibility Law
No. 23,928 was applicable in Argentina. This law established a fixed exchange   
rate, under which the Argentine Central Bank was obliged to sell U.S. dollars to
any person at a fixed rate of one Peso per U.S. dollar. Accordingly, the foreign
currency fluctuations were reduced to a minimum level during the fiscal year    
2001 and the subsequent interim period.                                         

The primarily economic change announced by the current Argentine  
government in January 2002 was the devaluation of the Peso. Most of our lease   
contracts and a significant portion of our liabilities are denominated in U.S.  
dollars. Foreign currency exchange rate fluctuations significantly increase the 
risk of default on our mortgage receivables, leases and services and other      
receivables, because many of our customers                                      

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have Peso-denominated revenue streams and will therefore experience a relative  
increase in their U.S. dollar-denominated liabilities compared to their         
Peso-denominated revenues. Foreign currency exchange restrictions hereafter     
imposed by the Argentine government could prevent or restrict our access to U.S.
dollars, affecting our ability to service our U.S. dollar- denominated          
liabilities. Also, fluctuations in the exchange rate between the Peso and the   
U.S. dollar may adversely affect the U.S. dollar equivalent of the Peso price of
our common shares on the Buenos Aires Stock Exchange, and as a result, are      
likely to affect the market price of our GDSs in the United States.             

SUSPENSION OF THE APPLICATION OF SECTION 206 OF THE ARGENTINE     
CORPORATIONS LAW                                                                

As of June 30, 2002, the negative results recorded by our Company 
absorbed more than 50% of capital and reserves. Section 206 of the Argentine    
corporations law establishes mandatory capital reduction when such a situation  
exists. However in view of the crisis that Argentina is undergoing, Executive   
Branch Decree 1269 suspended the application of this section until December 10, 
2003.                                                                           

OPERATING COSTS AND EXPENSES                                      

ALLOCATION OF SELLING EXPENSES TO BUSINESS SEGMENTS               

Selling expenses related to the shopping centers, hotels and      
international segments are directly allocated to such segments because such     
segments are individually managed and clearly identifiable. The remaining       
selling expenses are allocated among the development and sale of properties and 
offices and other non-shopping center rental properties segments, excluding     
those located in shopping centers, based on the cost center which incurred the  
selling expense.                                                                

ALLOCATION OF ADMINISTRATIVE EXPENSES TO BUSINESS SEGMENTS        

    Administrative expenses (other than those expenses we incurred for the
benefit of all the business segments) related to our shopping centers, hotels   
and International business segments are directly attributable to such segments  
because such segments are individually managed and are clearly identifiable.    
Administrative expenses include management fees paid, if any, to the managers of
such segments. The remaining administrative expenses are allocated to the       
different segments, based on the cost center in which they are incurred, as     
follows:                                                                        

     o    administrative expenses related to all business segments, as those
         corresponding to the board of directors, are allocated among each
 segment pro rata on the basis of their respective assets;

     o    administrative expenses incurred by certain departments associated
  with specific segments are allocated to such segments; and

    o    70% of the remaining administrative expenses are allocated to the
          development and sale of properties segment, and 30% to the offices
and other non-shopping center rental properties segment.

ALLOCATION OF RESULTS FROM THE  RESCINDING OF TOWERS              

       This results derive from the purchasers recessions of sales contracts for
units in Torres de Abasto in APSA and are allocated to "Sales and Developments".

  ALLOCATION OF RESULTS FROM OPERATIONS AND THE HOLDING OF REAL ESTATE
ASSETS                                                            

These results are allocated to the segment that generates them.   

ALLOCATION OF OTHER EXPENSES AND NET INCOME TO BUSINESS SEGMENTS  

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FINANCIAL RESULTS, NET. Includes interest income, gain (loss) on  
financial operations, financing expenses, gain (loss) on exposure to inflation, 
exchange differences and miscellaneous income (expense) allocable to each       
segment, as described below:                                                    

 INTEREST INCOME AND GAIN (LOSS) ON FINANCIAL OPERATIONS. Only those
related to the International, shopping center and hotel segments were separately
allocated to such segments, as each of them manage their own financial          
surpluses. The remaining amounts in this respect have been allocated to         
"financial operations and others" because they are not directly related to any  
segment in particular.                                                          

   FINANCING EXPENSES. Concerning the international, shopping center and
hotel segments, only the proportional financing expenses incurred in Brazil     
Realty, Fondo de Valores Inmobiliarios, APSA and hotels have been considered.   
The remaining proportional consolidated financing expenses have been apportioned
to the sales and development, office and others, hotel segments and the column  
headed "financial operations and others " pro rata in the basis of the total    
assets allocated to each such segment.                                          

GAIN (LOSS) ON EXPOSURE TO INFLATION, EXCHANGE DIFFERENCES AND    
MISCELLANEOUS. In the case of the business International, Shopping Center and   
Hotels are presented in the same business that was generated. The other is      
presented in "Others" in proportion to the assets related.                      

  NET INCOME IN AFFILIATED COMPANIES. These have been allocated to the
related segments. Regarding the income/loss related to the investments in IRSA  
Telecomunicaciones and Latin American Econetworks, they have been allocated to  
"financial operations and others" because they are not related to any segment in
particular.                                                                     

OTHER INCOME (EXPENSES). Only those related to the international, 
shopping center and hotel segments were separately allocated to such segments.  
The remaining amounts in this respect have been allocated to "financial         
operations and others" because they are not directly related to any segment in  
particular.                                                                     

  INCOME TAX. The income tax applicable to each segment was separately
applied to each such segment.                                                   

       EXTRAORDINARY LOSS. The extraordinary loss applicable to each segment was
separately applied to each such segment.                                        

BUSINESS SEGMENT REPORTING                                        

      We have determined that our reportable segments are those that are based
on our method of internal reporting. Accordingly, we have six reportable        
segments. These segments are development and sales of properties, office and    
other non-shopping center rental properties, shopping centers, hotel operations,
international, financial operations and others. The consolidated statements of  
income were prepared on a proportionate consolidation basis. As of July 1, 1996,
we used the "proportionate-consolidation method" of accounting for our          
investments in which we exercise control and other jointly-controlled           
investments. This method has not been used for balance sheet and cash flows     
purposes. Accordingly, this section reflects the results of operations of our   
controlled and jointly-controlled subsidiaries on a proportionate basis.        

A general description of each segment follows:                    

     Development and sale of properties. This segment includes the operating
results of our construction and ultimate sale of residential buildings business.

   Offices and other non-shopping center rental properties. This segment
includes the operating results of our lease and service revenues of office space
and other non-retail building properties from tenants.                          

  Shopping centers. This segment includes the operating results of our
shopping centers principally comprised of lease and service revenues from       
tenants. This segment also includes revenues derived from                       

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credit card transactions which consist of commissions and financing income.     

  Hotel operations. This segment includes the operating results of our
hotels principally comprised of room, catering and restaurant revenues.         

    International. This segme nt includes the results of operations of our
equity investments in:                                                          

    Brazil (which we sold in February 2002) for all periods presented; and

      Venezuela (which we sold in December 2000) for the period ended June 30,
2001.                                                                           

   Others. This segment primarily includes revenues and associated costs
generated from the sale of equity securities, other securities-related          
transactions and other non-core activities. For the fiscal year 2001 and the    
year ended June 30, 2002, this segment also includes the loss in our equity     
investees relating to Internet, telecommunications and other technology-related 
activities.                                                                     

   We measure our reportable segments based on net income. Inter-segment
transactions, if any, are accounted for at current market prices. We evaluate   
performance and allocate our resources to each segment based on net segment     
income. We are not dependent on any single customer.                            

    The following tables show certain operating data by business activity:

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                                               FOR THE FISCAL YEAR 2002 (IN MILLIONS OF PESOS)                        
                       ---------------------------------------------------------------------------------------------- 
                                     OFFICES AND                                           OTHER                      
                                     NON-SHOPPING                                                                     
                       DEVELOPMENT      CENTER                                                                        
                       AND SALE OF      RENTAL                     SHOPPING       HOTEL                               
                       PROPERTIES     PROPERTIES   INTERNATIONAL   CENTERS      OPERATIONS      OTHERS         TOTAL  
                       ------------  ------------  -------------   --------     ----------      -------        ------ 
                                                                                                                      
Sales................        45.2          34.3          24.8          77.6           29.5          --          211.3 
Costs................       (37.4)        (10.7)        (14.1)        (38.4)         (20.8)         --         (121.4)
Gross profit.........         7.8          23.6          10.8          39.2            8.7          --           90.0 
Selling expenses.....        (3.7)         (0.5)         (4.6)        (22.3)          (3.3)         --          (34.3)
Administrative                                                                                                        
expenses.............        (9.0)         (5.0)         (3.8)        (11.2)          (8.7)         --          (37.6)
Loss on purchasers                                                                                                    
rescissions of sale                                                                                                   
contracts............        (0.0)           --            --            --             --          --            0.0 
(Loss) gain from                                                                                                      
operations and                                                                                                        
holdings of real                                                                                                      
estate assets, net...       (30.8)        (41.7)         31.5         (23.9)            --          --          (65.0)
Operating income                                                                                                      
(loss)...............       (35.6)        (23.6)         33.9         (18.3)          (3.4)         --          (46.9)
Financial results,                                                                                                    
net..................       (18.5)        (14.8)         (3.6)          8.9          (15.5)     (388.6)        (432.2)
Net loss in equity                                                                                                    
investments..........          --            --           0.4          (3.9)            --         1.5           (2.0)
Other income                                                                                                          
(expenses), net......          --            --           0.0          (4.7)           0.2        (4.0)          (8.5)
(Loss) income before                                                                                                  
taxes and                                                                                                             
extraordinary loss...       (54.1)        (38.4)         30.8         (18.1)         (18.7)     (391.1)        (489.6)
Income tax...........        (0.6)         (3.3)         (4.5)         (1.3)          (0.1)       (0.1)         (10.0)
Net (loss) income                                                                                                     
ordinary for the year       (54.7)        (41.8)         26.2         (19.4)         (18.7)     (391.2)        (499.6)
Extraordinary loss...          --            --            --            --             --          --            --  
Net (loss) income                                                                                                     
for the year.........       (54.7)        (41.8)         26.2         (19.4)         (18.7)     (391.2)        (499.6)
Total assets.........       354.0         273.4          26.1         299.6          114.4        77.2        1,144.7 


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                                               FOR THE FISCAL YEAR 2001 (IN MILLIONS OF PESOS)                       
                       --------------------------------------------------------------------------------------------- 
                                     OFFICES AND                                                                     
                                        OTHER                                                                        
                                     NON-SHOPPING                                                                    
                       DEVELOPMENT      CENTER                                                                       
                       AND SALE OF      RENTAL                     SHOPPING       HOTEL                              
                       PROPERTIES     PROPERTIES   INTERNATIONAL   CENTERS      OPERATIONS      OTHERS         TOTAL 
                       -----------   ------------  -------------   --------     ----------      ------         ----- 
                                                                                                                     
Sales................        89.8          45.6          69.1          94.5        40.9            --          339.8 
Costs................       (68.2)         (8.9)        (31.0)        (36.8)      (27.1)           --         (172.0)
Gross profit.........        21.6          36.7          38.1          57.7        13.8            --          167.8 
Selling expenses.....        (8.5)         (0.5)         (8.7)        (11.4)       (4.7)           --          (33.8)
Administrative                                                                                                       
expenses.............       (13.4)         (6.3)         (7.2)        (14.1)       (9.8)           --          (50.7)
Loss on purchasers                                                                                                   
rescissions of sale                                                                                                  
contracts............         0.0            --            --            --          --            --            0.0 
(Loss) from                                                                                                          
operations and                                                                                                       
holdings of real                                                                                                     
estate assets, net...        (3.8)         (1.9)         (0.6)           --          --            --           (6.3)
Operating income.....        (4.1)         28.1          21.6          32.2        (0.8)           --           77.0 
Financial results,                                                                                                   
net..................       (25.0)        (20.0)        (14.4)        (28.1)       (8.5)        (14.5)        (110.3)
Net loss in equity                                                                                                   
investments..........         0.0            --          (1.3)         (1.4)         --          (7.6)         (10.3)
Other income                                                                                                         
(expenses), net......          --            --           0.0          (0.2)        0.2          (5.7)          (5.6)
(Loss) income before                                                                                                 
taxes and                                                                                                            
extraordinary loss...       (29.1)          8.1           5.9           2.5        (9.0)        (27.7)         (49.2)
Income tax...........         0.0          (2.4)         (1.9)         (0.8)        0.0            --           (5.1)
Net (loss) income                                                                                                    
ordinary for the year       (29.1)          5.7           4.0           1.7        (8.9)        (27.7)         (54.3)
Extraordinary loss...          --            --            --            --        (5.7)           --           (5.7)
Net (loss) income                                                                                                    
for the year.........       (29.1)          5.7           4.0           1.7       (14.6)        (27.7)         (60.0)
Total assets.........       419.4         335.0         142.0         326.0       117.1         155.1        1,494.6 

-----------                                                                     

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RESULTS OF OPERATIONS FOR THE FISCAL YEARS ENDED JUNE 30, 2002 AND 2001.        

TOTAL SALES                                                       

    Total sales decreased 37.8%, from Ps. 339.8 million in the fiscal year
ended June 30, 2001 to Ps. 211.3 million in the fiscal year ended June 30, 2002,
on account of a decrease in sales in all segments of our activity. This decrease
was primarily attributable to the severe and ongoing recession that the         
Argentine economy is undergoing and, therefore, it is paralyzing our operations 
that are mostly conducted in Argentina.                                         

    Development and sale of properties. Sales from development and sale of
properties decreased 49.6%, from Ps. 89.8 million for the fiscal year ended June
30, 2001 to Ps. 45.2 million for the fiscal year ended June 30, 2002. The       
decrease in sales in the development and sale of properties segment was         
attributable to: (i) the Ps. 21.6 million decrease in sales from the residential
communities of Abril and Villa Celina; (ii) the Ps. 12.0 million decrease in    
sales of undeveloped parcels of land, on account of the non-recurrence of sales 
of Dique IV and Monserrat made in 2001; (iii) the Ps. 4.7 million decrease in   
the sales of other real property primarily resulting from the lack of recurrence
of sales in Serrano 250, Sarmiento 580, Av. de Mayo 701, Madero 1020 and        
Montevideo 1975, partially offset by new sales during fiscal year 2002 of the   
real properties on Santa Fe 1588, Rivadavia 2243 and Libertador 498 and finally 
(iv) the Ps. 5.2 million reduction in interest income from financed sales       
primarily due to the sale on October 2001 of a significant portion of our real  
estate loans to Banco Sudameris Argentina S.A.. See "Business - Development     
Property".                                                                      

       Offices and other . Sales from Offices and other decreased 24.9% from Ps.
45.6 million during the fiscal year ended June 30, 2001 to Ps. 34.2 million     
during the fiscal year ended June 30, 2002. This decrease is primarily due to:  
(i) a 22.1% decrease in revenues from office rents from Ps. 39.5 million in the 
fiscal year ended June 30, 2001 to Ps. 30.8 million in the fiscal year ended    
June 30, 2002 mainly due to decreases in occupancy rates in almost all rental   
properties and (ii) a 45.5% decrease in sales from commercial property rents    
from Ps. 6.2 million in the fiscal year ended June 30, 2001 to Ps. 3.4 million  
in the fiscal year ended June 30, 2002 mainly due to the sales of the           
properties: Florida 291, Santa Fe 1588 and Montevideo 1975. See                 
"Business--Offices and Other Rental Properties".                                

    Shopping centers. Sales from Shopping Centers went down by 17.9%, from
Ps. 94.5 million during the fiscal year ended June 30, 2001 to Ps. 77.6 million 
for the fiscal year ended June 30, 2002. The decrease in revenues from leases   
and services is mainly due to the recession that the Argentine economy has been 
suffering for over 4 years, which has resulted in a decrease in sales of tenants
giving rise to a fall in both occupancy rates and revenues from minimal rent and
goodwill in all our shopping centers. The general occupancy rate of our shopping
centers decreased from 94% as of June 30, 2001 to 92% as of June 30, 2002.      

      Hotels. Sales from hotels went down 27.9%, from Ps. 40.9 million for the
fiscal year ended June 30, 2001 to Ps. 29.5 million for the fiscal year ended   
June 30, 2002, due to a decrease in the average occupancy level of hotels from  
58% in 2001 to 44% in 2002, as well as a decrease in rates, giving rise to a    
decrease in the sales from Hotel Sheraton Libertador of Ps. 5.2 million, from   
Hotel Intercontinental of Ps. 5.9 million and from Hotel Llao Llao of Ps. 0.3   
million during this year. See "Business - Hotels".                              

      International. Sales from international operations decreased 64.1%, from
Ps. 69.1 million for the fiscal year ended June 30, 2001 to Ps. 24.8 million for
the fiscal year ended June 30, 2002, mainly due to a decrease in the sales of   
Brazil Realty and the effect of the sale of FVI on the sales of the             
international segment during this fiscal year. Sales from Brazil Realty went    
down by 61.9%, from Ps. 65.2 million for the fiscal year ended June 30, 2001 to 
Ps. 24.8                                                                        

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million for the fiscal year ended June 30, 2002, due to the significant         
decrease in sales in Brazilian Reais between both fiscal years and in particular
due to the non recurrence during 2002 of the sales of the JK Financial Center   
and Brasilinvest offices and the sale of our equity interest in such company in 
February 2002. See "Business--International".                                   

TOTAL COSTS                                                       

     Total costs decreased 29.5%, from Ps. 172.0 million for the fiscal year
ended June 30, 2001 to Ps. 121.4 million for the fiscal year ended June 30,     
2002, mainly due to lesser costs from Development and Sale of properties, Hotels
and International, which decrease was partially offset by an increase in the    
costs related to the operation of Offices and other and Shopping Centers. Total 
costs as a percentage of sales increased from 50.6% for the fiscal year ended   
June 30, 2001 to 57.4% for the fiscal year ended June 30, 2002.                 

       Development and Sale of properties. The costs of Development and Sales of
properties decreased 45.1%, from Ps. 68.2 million for the fiscal year ended June
30, 2001 to Ps. 37.4 million for the fiscal year ended June 30, 2002, due to    
fewer sales of real properties. The costs of Development and Sale of properties 
as a percentage of sales from Development and Sale of properties increased from 
75.9% for the fiscal year ended June 30, 2001 to 82.7% for the fiscal year ended
June 30, 2002.                                                                  

       Offices and other. Costs of Offices and other rose by 19.9%, from Ps. 8.9
million for the fiscal year ended June 30, 2001 to Ps. 10.7 million for the     
fiscal year ended June 30, 2002. The costs of Offices and other as a percentage 
of sales resulting from Offices and other increased from 19.6% for the fiscal   
year ended June 30, 2001 to 31.2% for the fiscal year ended June 30, 2002. The  
increase in the cost of Offices and other in absolute terms and as a percentage 
of sales is due to the decrease in the average occupancy rate from 89% during   
all fiscal year 2001 to 72% during all fiscal year 2002, which resulted in an   
increase in the maintenance costs of the unoccupied units, especially as regards
common expenses. The main component of the cost of offices is represented by the
depreciation of leased properties.                                              

      Shopping Centers. The costs of Shopping Centers increased 4.3%, from Ps.
36.8 million for the fiscal year ended June 30, 2001 to Ps. 38.4 million for the
fiscal year ended June 30, 2002, mainly due to the increase in the cost of rents
derived from the recognition of a one-time loss for charges for expenses billed 
to the tenants in the fiscal year which were not recovered, which increase was  
partially offset by the reduction in the cost of sale of Torres de Abasto and   
the cost of Tarjeta Shopping operations. The costs of Shopping Centers as a     
percentage of sales resulting from Shopping Centers increased from 39.0% for the
fiscal year ended June 30, 2001 to 49.5% for the fiscal year ended June 30,     
2002. The main component of the cost of shopping centers in this fiscal year is 
represented by depreciation and amortization charges of leased properties,      
including the goodwill paid upon acquisition thereof.                           

Hotels. Costs from hotel operations decreased 23.3%, from Ps. 27.1
million for the fiscal year ended June 30, 2001 to Ps. 20.8 million for the     
fiscal year ended June 30, 2002, primarily due to: (i) lower levels of activity 
in this segment; (ii) decrease in the constant value of the cost components of  
Hotels such as salaries, fees and services mainly on account of the effect of   
this last semester inflation and                                                

(iii) the restructuring carried out to offset the fall in the level of occupancy
so as to attain greater efficiency. Hotel operating costs as a percentage of    
sales from hotels increased from 66.2% for the fiscal year ended June 30, 2001  
to 70.5% for the fiscal year ended June 30, 2002 primarily due to the           
combination of lower sales reflecting the fall in occupancy rates and to lower  
rates compared to the previous fiscal year together with the same incidence in  
both fiscal years of                                                            

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fixed costs such as depreciation. Costs of hotels are primarily composed of     
rooms, depreciation, food and beverages, salaries and social security           
contributions.                                                                  

     International. Costs of international operations fell by 54.7% from Ps.
31.0 million for the fiscal year ended June 30, 2001 to Ps. 14.1 million for the
fiscal year ended June 30, 2002, due to (i) lower costs in Brazilian Reais      
attributable both to a lower level of sales and to the sale of such company in  
the preceding quarter, which resulted in a Ps. 17.1 million decrease and (ii) a 
decrease in costs attributable to FVI as a consequence of the sale of our equity
interest during the previous fiscal year. International operating costs as a    
percentage of sales from international operations went up from 44.9% for the    
fiscal year ended June 30, 2001 to 56.7% for the fiscal year ended June 30,     
2002.                                                                           

TOTAL GROSS PROFIT                                                

     As a result of the foregoing, the total gross profit decreased by 46.4%
from Ps. 167.8 million for the fiscal year ended June 30, 2001 to Ps. 90.0      
million for the fiscal year ended June 30, 2002.                                

SELLING EXPENSES                                                  

     Selling expenses increased by 1.7% from Ps. 33.7 million for the fiscal
year ended June 30, 2001 to Ps. 34.3 million for the fiscal year ended June 30, 
2002, primarily due to the increase in Shopping Centers selling expenses and    
partially offset by the reduction in selling costs of the Hotels, International 
and Sales and Development segments. Selling expenses as a percentage of total   
revenues increased from 9.9% for the fiscal year ended June 30, 2001 to 16.2%   
for the fiscal year ended June 30, 2002.                                        

      Development and Sale of properties. Selling expenses for Development and
Sales decreased by 56.8% from Ps. 8.5 million for the fiscal year ended June 30,
2001 to Ps. 3.7 million during the fiscal year ended June 30, 2002, as a        
consequence of the decrease in sale operations during this fiscal year          
generating less direct selling expenses. Selling expenses of Development and    
Sale of properties as a percentage of sales from Development and Sale of        
properties decreased from 9.5% for the fiscal year ended June 30, 2001 to 8.1%  
for the fiscal year ended June 30, 2002. The main components of selling expenses
of Development and Sale of properties are commissions and expenses from sales   
and advertising.                                                                

    Offices and other . Selling expenses of Offices and other increased by
1.9% from Ps. 0.47 million during the fiscal year ended June 30, 2001 to Ps.    
0.48 million during the fiscal year ended June 30, 2002. Selling expenses of    
Offices and other properties as a percentage of sales from Offices and other    
increased from 1.0% for the fiscal year ended June 30, 2001 to 1.4% for the     
fiscal year ended June 30, 2002.                                                

       Shopping Centers. Selling expenses of Shopping Centers rose by 96.1% from
Ps. 11.4 million for the fiscal year ended June 30, 2001 to Ps. 22.3 million for
the fiscal year ended June 30, 2002, resulting mainly from the increase in bad  
debts charges, that was partially offset with a decrease in advertising         
expenses, salaries and bonuses. Selling expenses of Shopping Centers as a       
percentage of sales from Shopping Centers increased from 12.0% for the fiscal   
year ended June 30, 2001 to 28.7% for the fiscal year ended June 30, 2002. The  
main components of selling expenses of Shopping Centers are bad debts charges   
and advertising expenses.                                                       

    Hotels. Selling expenses dropped 30.0% from Ps. 4.7 million during the
fiscal year ended June 30, 2001 to Ps. 3.3 million for the fiscal year ended    
June 30, 2002, primarily due to a                                               

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decrease in advertising expenses and to a lesser extent a decrease in salaries  
and social security contributions in all Hotels. Selling expenses of Hotels as a
percentage of sales from Hotels decreased from 11.6% for the fiscal year ended  
June 30, 2001 to 11.3% for the fiscal year ended June 30, 2002. The main        
components of selling expenses are advertising expenses and salaries.           

      International. Selling expenses of international operations decreased by
47.3% from Ps. 8.7 million for the fiscal year ended June 30, 2001 to Ps. 4.6   
million for the fiscal year ended June 30, 2002, basically due to (i) a drop in 
selling expenses of FVI of Ps. 0.2 million as a result of the sale of such      
Company in the previous fiscal year and (ii) a decrease in selling expenses of  
Brazil of Ps. 3.9 million as a result of the fall in the sale operations during 
this fiscal year, which originated less direct selling expenses, and of the sale
of our equity interest in Brazil in February 2002. Selling expenses as a        
percentage of sales from international operations increased from 12.6% for the  
fiscal year ended June 30, 2001 to 18.4% for the fiscal year ended June 30,     
2002. The main components of selling expenses are advertising expenses and      
commissions.                                                                    

ADMINISTRATIVE EXPENSES                                           

       Administrative expenses decreased by 25.8%, from Ps. 50.7 million for the
fiscal year ended June 30, 2001 to Ps. 37.6 million for the fiscal year ended   
June 30, 2002, due to lower expenses in all the segments. As a percentage of    
sales, administrative expenses rose from 14.9% for the fiscal year ended June   
30, 2001 to 17.8% for the fiscal year ended June 30, 2002. The main components  
for the fiscal year are salaries and social security contributions, fees and    
compensations for services and depreciation and amortization.                   

Development and Sale of properties. Administrative expenses of    
Development and Sale of properties decreased by 33.2% from Ps. 13.4 million for 
the fiscal year ended June 30, 2001 to Ps. 9.0 million for the fiscal year ended
June 30, 2002, primarily due to (i) the restructuring carried out with the      
purpose of achieving a structure sustainable in the medium term and (ii) the    
decreases as measured in constant values of expenses such as salaries, fees and 
services, principally due to the effect of inflation during the last semester.  
Administrative expenses of Development and Sale of properties as a percentage of
sales from Development and Sales increased from 15.0% for the fiscal year ended 
June 30, 2001 to 19.8% for the fiscal year ended June 30, 2002.                 

      Offices and other. The administrative expenses of Offices and other fell
by 21.0% from Ps. 6.3 million for the fiscal year ended June 30, 2001 to Ps. 5.0
million for the fiscal year ended June 30, 2002, primarily due to (i) the       
restructuring carried out with the purpose of achieving a structure sustainable 
in the medium term and (ii) the decreases as measured in constant values of     
expenses such as salaries, fees and services, mainly due to the effect of       
inflation during the last semester. Administrative expenses of Offices and other
as a percentage of the sales from this segment increased from 13.8% for the     
fiscal year ended June 30, 2001 to 14.5% for the fiscal year ended June 30,     
2002.                                                                           

     Shopping Centers. Administrative expenses of Shopping Centers decreased
by 20.1%, from Ps. 14.0 million for the fiscal year ended June 30, 2001 to Ps.  
11.2 million for the fiscal year ended June 30, 2002 due to a general fall in   
administrative expenses, especially salaries and social security contributions, 
fees and compensations for services. Administrative expenses of Shopping Centers
as a percentage of sales from Shopping Centers decreased from 14.9% for the     
fiscal year ended June 30, 2001 to 14.5% for the fiscal year ended June 30,     
2002. The main components of administrative expenses of Shopping Centers are    
salaries, fees for services and fees paid to Directors.                         

     Hotels. Administrative expenses of Hotels dropped by 11.1% from Ps. 9.8
million for the fiscal year ended June 30, 2001 to Ps. 8.7 million during the   
fiscal year ended June 30, 2002,                                                

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basically due to the decrease during this fiscal year of all the administrative 
expenses of Llao Llao, Intercontinental and Sheraton Libertador Hotels, and     
especially due to reductions in fees for services, salaries and social security 
contributions. Administrative expenses of hotels as a percentage of sales from  
the hotel operation rose from 24% during the fiscal year ended June 30, 2001 to 
29.6% during the fiscal year ended June 30, 2002. The main components of        
administrative expenses of the hotel operation are salaries, fees for services, 
depreciation and amortization.                                                  

International. Administrative expenses of international operations
decreased by 47.4%, from Ps. 7.2 million during the fiscal year ended June 30,  
2001 to Ps. 3.8 million during the fiscal year ended June 30, 2002, mainly due  
to (i) a decrease in administrative expenses of FVI of Ps. 0.9 million as a     
result of the sale of such company in 2001 and (ii) a decrease in the           
administrative expenses of Brazil of Ps. 2.4 million. Administrative expenses as
a percentage of sales from international operations increased from 10.4% during 
the fiscal year ended June 30, 2001 to 15.2% during the fiscal year ended June  
30, 2002.                                                                       

LOSS ON PURCHASERS' RESCISSIONS OF TORRES SALES CONTRACT, NET     

The losses resulting from the rescission of Torres de Abasto sales
contracts varied from a loss of Ps. 0.01 million in the fiscal year ended June  
30, 2001 to a profit of Ps. 0.03 in the fiscal year ended June 30, 2002.        

RESULTS FROM OPERATIONS AND HOLDINGS OF REAL ESTATE ASSETS, NET   

       Results from operations and holdings of real estate assets, net, showed a
Ps. 58.7 million loss change between both fiscal years, from a Ps. 6.3 million  
loss for the fiscal year ended June 30, 2001 to a Ps. 65.0 million loss for the 
fiscal year ended June 30, 2002. This decrease results mainly from the net      
result between (i) the gain obtained from the sale of our equity interest in    
Brazil Realty which amounted to Ps. 31.5 million in this fiscal year; (ii) the  
non-recurrence in 2002 of the Ps. 1.0 million loss attributable to the sale of  
our equity interest in FVI recognized in 2001 and (iii) the Ps. 91.2 million    
loss from the impairment of long-lived assets, which rose from Ps. 5.7 million  
during 2001 to Ps. 96.9 million during 2002. This Ps. 91.2 million loss from the
impairment of long-lived assets between both fiscal years, was distributed among
our segments as follows: (a) Development and Sales: Ps. 27.0 million, (b)       
Offices and Others: Ps. 39.8 million and (c) Shopping Centers: Ps. 24.4 million.

OPERATING INCOME                                                  

       As a result of the foregoing, the total operating income decreased from a
Ps. 77.0 million gain during the fiscal year ended June 30, 2001 to a Ps. 46.9  
million loss during the fiscal year ended June 30, 2002.                        

    Development and Sale of properties. Operating results from Development
and Sales of properties showed an improvement, from a Ps. 4.1 million loss for  
the fiscal year ended June 30, 2001 to a Ps. 35.6 million loss for the fiscal   
year ended June 30, 2002.                                                       

       Offices and other. The operating results from Offices and other decreased
from a Ps. 28.1 million profit for the fiscal year ended June 30, 2001 to a Ps. 
23.6 million loss for the fiscal year ended June 30, 2002.                      

     Shopping Centers. The operating results from Shopping Centers decreased
from a Ps. 32.2 million profit for the fiscal year ended June 30, 2001 to a Ps. 
18.3 million loss for the fiscal year ended June 30, 2002.                      

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Hotels. The operating results from hotels increased from a Ps. 0.8
million loss for the fiscal year ended June 30, 2001 to a Ps. 3.4 million loss  
for the fiscal year ended June 30, 2002.                                        

International. The operating results from international operations
increased 57.0% from Ps. 21.6 million for the fiscal year ended June 30, 2001 to
Ps. 33.9 million for the fiscal year ended June 30, 2002. The operating margin  
for international operations increased from 31.3% for the fiscal year ended June
30, 2001 to 136.7% for the fiscal year ended June 30, 2002.                     

FINANCIAL RESULTS, NET                                            

The total net financial results reflected an increase from a loss of Ps. 110.3  
million during the fiscal year ended June 30, 2001 to a loss of Ps. 432.2       
million during the fiscal year ended June 30, 2002. The total increase in       
financial results was primarily due to: (i) the increase in the net loss of Ps. 
294.9 million as compared to the previous fiscal year due to the joint effect of
the peso devaluation and inflation, the impact of foreign currency denominated  
net debts, partially offset by a Ps. 84.6 million reduction in financing        
expenses, which dropped from Ps. 100.7 million during 2001 to Ps. 16.1 million  
during 2002 as a result of the impact of the negative actual financing interest 
rate on our loans and (ii) an increase in the loss for financial transactions   
for Ps. 113.4 million as compared to 2001, mainly due to the fall in the value  
of the stock of Banco Hipotecario, to losses connected with investments such as 
Telecom stock, Pro1 bonds and FRB and the drop in the quotation of Quantum Fund 
during this fiscal year.                                                        

NET (LOSS) -- INCOME IN COMPANIES SECTION 33, LAW 19,550          

The net results derived from affiliated companies showed an 80.9% 
reduction from a loss of Ps. 10.3 million during the fiscal year ended June 30, 
2001 to a loss of Ps. 2.0 million during the fiscal year ended June 30, 2002,   
mainly due to a reduction in the loss derived from IRSA Telecomunicaciones      
investment for an aggregate amount of Ps. 8.0 million. .                        

OTHER INCOME (EXPENSES), NET                                      

The other income (expenses), net line increased 51.3% from a loss of Ps. 5.6    
million during the fiscal year ended June 30, 2001 to a loss of Ps. 8.5 million 
during the fiscal year ended June 30, 2002, basically due to: (i) the loss      
originated during the current fiscal year by the new tax on bank credits and    
debits for Ps. 1.8 million; (ii) the Ps. 1.3 million decrease in the results    
from the repurchase of Negotiable Obligations of Alto Palermo in the open       
market, from an income of Ps. 1.2 million during 2001 to a loss of Ps. 0.2      
million during 2002; (iii) the loss resulting from a contingency due to lawsuits
of Alto Palermo for Ps. 3.5 million, mainly resulting from a provision for a    
lawsuit brought by Carrefour supermarket in connection with the construction of 
Paseo Alcorta shopping center, which decreases were partially offset by (iv)    
lower charges from gifts and non-computable VAT as compared to the previous     
fiscal year for Ps. 3.7 million.                                                

ORDINARY LOSS BEFORE TAXES                                        

       As a consequence of the factors described above, the ordinary loss before
taxes and extraordinary results showed an increase from a Ps. 49.2 million loss 
during the fiscal year ended June 30, 2001 to a loss of Ps. 489.6 million during
the fiscal year ended June 30, 2002.                                            

INCOME TAX AND MINIMUM PRESUMED INCOME TAX                        

    Income tax increased 97.1% from Ps. 5.1 million during the fiscal year
ended June 30, 2001 to Ps. 10.0 million during the fiscal year ended June 30,   
2002, mainly due to the net                                                     

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variation between (i) the increase during the current fiscal year of IRSA's     
Minimum Presumed Income Tax charges by Ps. 3.6 million, as an income tax        
recovery for such amount was computed during 2001 as a result of the amendments 
of Law 25,360, and of Brazil's Income Taxe by Ps. 1.6 million; and (ii) the     
reduction during this fiscal year of the Income Tax charges of APSA group by Ps.
0.2 million and FVI by Ps. 0.2 million, due to the sale of this company during  
the previous fiscal year.                                                       

ORDINARY LOSS FOR THE FISCAL YEAR                                 

       As a consequence of the factors described above, the ordinary loss before
extraordinary results showed an increase from a Ps. 54.3 million loss during the
fiscal year ended June 30, 2001 to a loss of Ps. 499.6 million during the fiscal
year ended June 30, 2002.                                                       

EXTRAORDINARY LOSS                                                

      During the fiscal year ended June 30, 2002 no extraordinary results were
registered as compared to the fiscal year ended June 30, 2001, when they        
amounted to a loss of Ps. 5.7 million due to our share in the results recognized
by Llao Llao Resorts S.A. as a consequence of adjustments in the provisions     
recorded in connection with a lawsuit brought by the National Parks             
Administration (Administracion de Parques Nacionales).                          

NET LOSS FOR THE FISCAL YEAR                                      

   As a consequence of the factors mentioned above, the net loss for the
fiscal year changed from a loss of Ps. 60.0 million during the fiscal year ended
June 30, 2001 to a loss of Ps. 499.6 million during the fiscal year ended June  
30, 2002.                                                                       

LIQUIDITY AND CAPITAL RESOURCES                                                 

      The following table summarizes the statement of cash flows for the years
ended June 30, 2002 and 2001, respectively.                                     

                                              YEAR ENDED JUNE 30
                                                2002                2001
                                               (IN MILLION OF PESOS)
Net proceeds generated by (used in)                               
   Operations                                    47.3               95.9
   Investment activities                        (17.5)              72.8
    Financing activities                         (37.9)            (164.6)

    Historically our principal requirements for funds have arisen from the
purchase and development of property. We have mainly sought financing through   
the issue of debt and shares to obtain funds to cover our needs. We expect funds
from our operations to form the main source to meet our working capital needs.  

      As of June 30, 2002 we had working capital deficit of Ps. 469.8 million.
At the same date we held funds for a total of Ps. 25.3 million. As of June 30,  
2001 we held funds for a total of Ps. 33.3 million.                             

      During the fiscal year ended June 30, 2002, the main source of liquidity
for our Company were the funds generated by operations for a total amount of Ps.
47.3 million. The sale of inventory generated an increase in funds of Ps. 52.8  
million and the reduction in receivables from sales and rentals generated a     
further increase of Ps. 38.0 million. This increase in funds was offset by an   
increase in current investments and other receivables for Ps. 29.5 million. The 
overall net variation generated a reduction in funds for Ps. 14.0 million.      

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Our investing activities resulted in net cash outflows of Ps. 17.5
million for fiscal year 2002. The sale of Brazil Realty generated an inflow of  
funds of Ps. 103.3 million, which was offset by the granting of loans to our    
subsidiary APSA for Ps. 94.1 million. Investments were also made in fixed assets
for Ps. 21.1 million, mainly in the purchase of "Costero Dique IV" office       
building for Ps. 18.4 million. The remaining investments in related companies   
generated a net reduction of Ps. 2.7 million and were applied to land reserves  
for Ps. 3.0 million, of which Ps. 2.2 million was invested in Dique III.        

      Financing activities during the year required an application of funds of
Ps. 37.9 million, having applied Ps. 187.5 million to the settlement of loans   
and receiving Ps. 151.3 million under the same heading. Also during this year we
have repaid debt from the purchase of subsidiaries for Ps. 1.8 million.         

       We plan to continue with the sale of non-core assets to be able to obtain
funds to repay our debt. We consider that the refinancing of our existing debt  
and the sale of non-strategic assets, together with our funds generating        
activities will provide us with the necessary working capital to cover our      
needs.                                                                          

OUR INDEBTEDNESS                                                                

  Our total outstanding debt as of June 30, 2002 was Ps. 566.4 million
compared to Ps. 380.9 million as of June 30, 2001. Out of the Ps. 566.4 million 
outstanding as of June 30, 2002, Ps. 564.7 million corresponded to short term   
bank debt and the rest was debt from the purchase of shares in related          
companies, Ps. 0.8 million being short term and Ps. 0.7 million long term. The  
increase in total debt as of June 30, 2002, compared to June 20, 2001 has been  
mainly due to the effect of devaluation on our loans in foreign currency. We    
have already begun to negotiate with our creditors to refinance the debt over   
the long term under new conditions, and we expect to reach an agreement shortly.

  Pursuant to Decree No. 214, part of our indebtedness was "pesified,"
although a large portion, governed by foreign laws continued to be              
dollar-denominated. "Pesified" indebtedness is to be adjusted by the CER index. 

       Between January and June of 2002, we repaid "pesified" short-term debt in
an aggregate amount of Ps. 46.7 million with the proceeds of the sale of Brazil 
Realty and cash from operations, using rescheduled time deposits as payment.    
Repayment was made at discounts on the original U.S. dollar value of the debt   
and on the converted Peso value of the debt.                                    

     Syndicated Credit Facility and Floating Rate Notes. On May 24, 2000, we
entered into a US$ 80 million syndicated loan arranged by BankBoston N.A. with  
an original maturity on July 31, 2001. Loans under this syndicated credit       
facility bear interest at three-month LIBOR plus a margin of 500 basis points.  

    Amounts owing under the syndicated credit facility are payable in U.S.
dollars. Although final maturity on the loan agreement was on July 31, 2002, due
to the continuing effects of economic recession, the unavailability of financing
sources and the succession of recent governmental measures adversely affecting  
the normal operations of the banking and payments system, we agreed with the    
holders of our credit facility to reschedule maturity to September 30, 2002. We 
hope to renegotiate this facility under new conditions, by that date.           

On December 18, 2000, we issued US$ 43.5 million unsecured Class 2
floating rate notes due December 24, 2001. Proceeds from this issuance were used
to repay certain outstanding short-term indebtedness. Our floating rate notes   
matured in December 2001, and we were unable to pay the principal then due. As a
result of such non-payment, in December 2001, we entered into negotiations with 
the holders of our floating rate notes and to date have been able to obtain     
short-term deferrals of our obligation to pay such matured notes. On February 8,
2002, we agreed with our holders to replace the floating interest rate for an   
annual fixed interest rate of 12%. Pursuant to the most recent deferral, granted
on September 9, 2002, principal and interest on the floating rate notes must be 
paid in full on September 30, 2002. The capitalization of interest due on       
September 9, 2002 was also agreed upon with the holders.                        

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On May 15, 2002, we repurchased a portion of the notes, which resulted in a     
reduction of the outstanding amount to US$ 40.1 million. We are currently       
negotiating with the note holders the available alternatives for the repayment  
of these notes.                                                                 

The floating rate notes and the syndicated credit facility include
various restrictive covenants, which among other things, require us to meet     
certain financial tests and to comply with certain other covenants, including   
restrictions on incurrence of debt and liens, restrictions on mergers,          
acquisitions, asset dispositions, capital contributions, repurchases of stock   
and investments. As of June 30, 2001, we stopped complying with certain         
financial covenants in our floating rate notes and our syndicated credit        
facility. To avoid possible acceleration from debtors, we obtained waivers to   
these financial covenants from the lenders under the syndicated credit facility 
and several amendments were agreed on with the holders of floating rate notes.  

As of June 30, 2002, we were not in compliance with certain of the
financial covenants under the floating rate notes and syndicated credit         
facility, and a waiver had been granted by the respective holders banks in      
relation to such covenants.                                                     

       Subordinated Intercompany Loan to APSA. On February 8, 2002 we and Parque
Arauco, principal shareholders of APSA, subordinated the collection of loan     
receivables granted by us to APSA to the repayment of principal and interest on 
APSA's US$ 120 million Senior Notes and on its short-term debt.                 

 Loan to Hoteles Argentinos. In January 2001, our subsidiary Hoteles
Argentinos S.A., owner of 100% of Hotel Sheraton Libertador, obtained a US$ 12.0
million loan from BankBoston N.A. The maturity date is January 2006 and the loan
bears interest on a quarterly basis at LIBO rate plus a spread ranging between  
401 and 476 basis points, depending on the value of certain financial ratios.   
This loan was not pesified and remains in U.S. dollars due to the fact it is    
governed by New York law.                                                       

     Other Loans Recently Repaid. On October 11, 2001, Banco Galicia granted
us a Ps. 7.0 million loan with a one-year maturity. The loan accrued interest at
Encuesta corregida rate (rate reported daily by Argentine Central Bank which    
represents the average paid by banks on 30-35 day dollar denominated deposits of
over Ps. 1,000,000) plus 500 basis points. According to Decree No. 214, this    
loan was pesified. In May 2002 we repaid this loan in full at a discount to its 
Peso value by tendering rescheduled time deposits in payment.                   

    Cyrela Loan. On August 29, 2001 we obtained a loan from Cyrela Capital
Management Ltd. for US$ 10.0 million. This loan was payable on June 5, 2002 and 
accrued interest at 12% annually. This loan was secured by pledging 8,089,800   
shares and 591,020 ADSs of Brazil Realty. We repaid this loan in full upon the  
sale of our interest in Brazil Realty in February 2002.                         

       Issue of negotiable obligations convertible into ordinary shares of IRSA.
The Ordinary and Extraordinary shareholders' meeting of IRSA, held on March 8,  
2002, authorized the issue of negociable obligations convertible into ordinary  
shares of th Company with a par value of Ps. 1 each and one vote per share, for 
up to an amount of US$ 100 million, which were to accrue interest at a fixed    
rate of between 6% and 12% p.a. payable six monthly in arrears with a conversion
price arising out of the market price of our shares plus a premium of up to 10%,
to be determined by the board, with stock option warrants attached for exercise 
at a conversion price plus a premium of between 20% and 30%. The funds generated
by the issue were to be mainly assigned to the settlements of existing          
liabilities at that date and to subscribe to a convertible negotiable bond issue
offered by APSA. The corresponding approvals from the corporate governance      
bodies required for this issue are currently pending.                           

APSA'S INDEBTEDNESS                                               

      In relation to the negotiable obligations for Ps. 85.0 million due April
7, 2005 APSA entered into a swap agreement with Morgan Guaranty Trust to cover  
and reduce the interest rate of such notes,                                     

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converting part of the Peso-denominated fixed rate debt into U.S.               
dollar-denominated floating rate debt. However, due to the economic situation,  
the political instability and the depreciation of the Argentine public debt,    
there was a negative deviation of the performance of the swap agreement that    
required the modification of the original terms.                                

     To solve the problem, resort was made to the experience of the managers
to achieve a higher degree of certainty regarding the situation. As a result, on
July 20, 2001, APSA signed a new swap agreement that eliminated the implicit    
rate risk in Peso/dollar futures, avoiding worse consequences for the Company.  
To achieve this change it was necessary to set up a deposit in guarantee for US$
50 million. Both ourselves and Parque Arauco S.A., as its principal             
shareholders, have granted loans to enable the constituting of the guarantee    
required by the swap. The remaining principle was financed out as part of its   
working capital.                                                                

       During December 2001, the swap was partially settled, with a reduction in
the amount of the transaction from US$ 85 million to US$ 69.1 million, while at 
the same time the repurchase was carried out of its negotiable obligations      
denominated in Pesos due April 7, 2005, for a nominal value of Ps. 15.5 million 
under par value. The two transactions together led to a loss to APSA of Ps. 0.3 
million.                                                                        

  With regard to the negotiable obligations for Ps. 120 million due in
January 2005, during the year there have been certain lags in the ratio for     
interest cover to EBITDA covenanted. For this reason, the board of APSA called  
special meetings of noteholders that were held on November 15, 2001 and February
18, May 3 and August 22, 2002. At these meetings a succession of limited waivers
were obtained for this non-compliance, the last of which was valid through the  
presentation of its Financial Statements as of September 30, 2002.              

      In the case of the negotiable obligations for Ps. 85 million, in view of
the fact that an agreement has still not been reached with the noteholders,     
non-compliance with the financial commitments meant that APSA was unable to take
on any debt in addition to that which it held as of September 2001.             

    The devaluation of the Argentine peso was accompanied by a decision to
"pesify" by decree contracts signed in foreign currency between private parties 
that were ruled by the Argentine law. As a result, its negotiable obligations   
for Ps. 120 million were converted into Pesos, as was 100% of its short term    
bank debt and 100% of the debt due to shareholders. As a consequence, its debt  
was left mainly denominated in Pesos.                                           

Nevertheless, although after the devaluation much of our debt was 
"pesified", as indicated above, the application of a "Reference Stabilization   
Index (CER) to this debt has meant a significant increase in its value, leading 
to excessive financial charges.                                                 

       In a highly dynamic manner, in a clear demonstration of business agility,
the Company's management raised the possibility of settling a large part of our 
debt with banks making use of two alternatives that resulted in a significant   
reduction of the financial burden. These options were:                          

     o   payment of principal and interest with rescheduled Time
            Deposits that enable a saving of approximately  20% of the
amount to be paid; or 20                      

             o   pre payment of 100% of the principal and interests in cash with
             a similar discount to the 20% obtained in the settlement of
time deposits.                                

       Issue of negotiable obligations convertible into ordinary shares of APSA.
The Ordinary and Extraordinary shareholders meeting of APSA, held on December 4,
2001, authorized the issue of convertible bonds convertible into common stock of
APSA with a par value of Ps. 0.10 each and one vote per share, for up to an     
amount of US$ 100 million, which were to accrue interest at a fixed rate of 10% 
p.a. payable semi-annually in arrears with a conversion price of between Ps.    
0.10 and Ps. 0.15, to be                                                        

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determined by the board. The funds generated by the issue were to be assigned to
the settlement of existing liabilities at that date.                            

On August 30, 2002, APSA concluded the period for preferential    
subscription for Series I for up to US$ 50,000,000 in book-entry negotiable     
obligations convertible into ordinary shares with a par value of US$ 0.10 each. 
IRSA subscribed to a total of US$ 27.2 million of these convertible negotiable  
obligations.                                                                    

       We consider that in our industry success requires a substantial liquidity
to maintain flexibility and take advantage of real estate opportunities at the  
moment they arise. As a result, we generally tend to keep liquidity at a high   
level. We invest our liquid assets mostly in time deposits and occasionally in  
the stock of local companies and Argentine Government securities, to take       
advantage of market opportunities. In addition, we also invest in securities and
bonds issued by foreign companies. In future, our need to avoid becoming a PFIC 
-Passive Foreign Investment Company - as regards the tax treatment applicable to
its shareholders in the USA, or in an investment company under the terms of the 
1940 Investment Company Act in the USA, could restrict our ability to make      
certain short term investments.                                                 

     The issue of the convertible notes has allowed APSA to pay an important
portion of its existing debt as of March 2002. The funds obtained have been     
allocated to the full repayment of (i) short-term bank debt which, as of March  
31, 2002, came up to approximately Ps. 39.0 million, and (ii) the amount of Ps. 
47.0 of the senior secured notes.                                               

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MANAGEMENT

BOARD OF DIRECTORS                                                              

       Our administration and management is the responsibility of our board. Our
by-laws lay down that the board will be made up of a minimum of eight and       
maximum of fourteen full directors and eight to fourteen alternate directors. We
are managed by a board of directors, which is composed of nine directors and    
four alternate directors. Our directors and alternate directors are elected for 
three year terms by our shareholders by a majority vote at an ordinary          
shareholders' meeting.                                                          

   Our current board of directors was elected at a shareholders' meeting
held in October 2001. Three of the directors elected on that shareholders'      
meeting have resigned. On March 21, 2002, our board of directors accepted the   
resignation of our former director Gary Gladstein and on May 17, 2002, our board
of directors accepted the resignation of our former directors Enrique A.        
Antonini and Emilio J. Cardenas. As of today, none of the directors that        
resigned have been replaced. Our current directors are as follows:              

                                                        [Enlarge/Download Table]


                NAME                              POSITION                   CURRENT POSITION HELD SINCE     
-------------------------------------------------------------------------------------------------------------
                                                                                                             
Eduardo S. Elsztain                     Chairman of the board                           1991                 
M. Marcelo Mindlin                      First Vice-chairman of the                      1991                 
                                        board                                                                
Saul Zang                               Second Vice-chairman of the                     1994                 
                                        board                                                                
Ernesto M. Vines (with licence)         Director                                        1991                 
Oscar P. Bergotto                       Director                                        1994                 
Fernando A. Elsztain                    Director                                        1999                 
A. Gabriel Juejati                      Director                                        1999                 
Jeremiah W. O'Connor                    Director                                        1999                 
Alejandro G. Elsztain                   Director                                        2001                 
Salvador D. Bergel                      Alternate Director                              1996                 
Juan C. Quintana Teran                  Alternate Director                              1996                 
Gabriel A.G. Reznik                     Alternate Director                              1999                 
Thomas Quinn                            Alternate Director                              1999                 


     The following is a brief biographical description of each member of our
board of directors:                                                             

     Eduardo S. Elsztain. Mr. Elsztain studied accounting at the Universidad
de Buenos Aires. He has been engaged in the real estate business for more than  
twenty years. He founded Dolphin Fund Management. He is chairman of the board of
directors of APSA, SAPSA, Dolphin Fund Management, Hoteles Argentinos and Cresud
among others; he is also vice-chairman of Banco Hipotecario S.A. and E-Commerce 
Latina S.A. He is Fernando A. Elsztain's cousin and Alejandro G. Elsztain's     
brother.                                                                        

     M. Marcelo Mindlin. Mr. Mindlin obtained a degree in economics from the
Universidad de Buenos Aires and a master degree in business administration at   
the Centro de Estudios Macroeconomicos de Buenos Aires. He is the vice-chairman 
of the board of directors of APSA, Dolphin Fund Management, Hoteles Argentinos  
and Cresud; and director of Banco Hipotecario S.A.                              

  Saul Zang. Mr. Zang obtained a degree in law from the Universidad de
Buenos Aires. He is founding partner of the law firm Zang, Bergel & Vines. He is
also the second vice-chairman of Cresud and vice-chairman of Puerto Retiro and  
Fibesa; a director of APSA, Banco Hipotecario S.A., Nuevas Fronteras S.A.,      
Tarshop and Palermo Invest S.A.; and an alternate director of SAPSA.            

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       Ernesto M. Vines. Mr. Vines obtained a degree in law from the Universidad
de Buenos Aires. He is a founding partner of the law firm Zang, Bergel & Vines  
and vice-president general counsel of Banco Hipotecario S.A.. He is a director  
of Cresud and also an alternate director of APSA, Inversora Bolivar and         
Emprendimientos Recoleta.                                                       

   Oscar P. Bergotto. Mr. Bergotto is the chief treasury officer of IRSA
since 1991. He has also worked in various other real estate companies. He is an 
alternate director of APSA and Dolphin Fund Management.                         

Fernando A. Elsztain. Mr. Elsztain studied architecture at the    
Universidad de Buenos Aires. He has been our chief commercial officer since     
March 1994. He has been engaged in the real estate business as consultant and as
managing officer of a family-owned real estate company. He is chairman of the   
board of directors of Llao Llao Resorts S.A., Palermo Invest S.A. and Nuevas    
Fronteras S.A. He is also a director of APSA, Hoteles Argentinos and Tarshop;   
and an alternate director of Banco Hipotecario S.A. and Puerto Retiro among     
others. He is the cousin of Alejandro G. Elsztain and Eduardo S. Elsztain.      

A. Gabriel Juejati. Mr. Juejati has been engaged in real estate   
activities since 1975. He is one of the founding members of Gama Propiedades, an
Argentine real estate brokerage company. He is chairman of Shopping Neuquen,    
Fibesa, Tarshop and Emprendimientos Recoleta; he is executive vice-chairman of  
APSA and vice-chairman of SAPSA. He is also a director of Nuevas Fronteras S.A. 
and Altocity.Com among others.                                                  

      Jeremiah W. O'Connor, Jr. Mr. O'Connor obtained a degree in economics at
Holy Cross College and a masters in business administration at Harvard Business 
School. He is the founder and president of The O'Connor Group, a global real    
estate company established in 1983. He is also associate president of The       
Peabody Group, a sponsor of real estate opportunity funds. He is a director and 
trustee of TrizecHahn Corporation (Canada), Grupo Empresarial Metropolitano S.A.
de C.V. (Mexico), BEG S.A. (France), Manhattan Institute, The Catholic Community
Fund and Holy Cross College where he also acts as president of its endowments   
fund. Mr. O'Connor has been president of the International Shopping Center      
Council.                                                                        

   Alejandro G. Elsztain. Mr. Elsztain obtained a degree in agricultural
engineering from the Universidad de Buenos Aires. He is chairman of Inversiones 
Ganaderas and a director of APSA and CRESUD S.A.C.I y A. He is the brother of   
our chairman Eduardo S. Elsztain and is the cousin of our director, Fernando A. 
Elsztain.                                                                       

    Salvador D. Bergel. Mr. Bergel obtained a degree in law and a Ph.D. in
law from the Universidad del Litoral. He is a founding partner of the law firm  
of Zang, Bergel & Vines and a consultant to Repsol YPF S.A. He is also an       
alternate director of Cresud.                                                   

      Juan C. Quintana Teran. Mr. Quintana Teran obtained a degree in law from
the Universidad de Buenos Aires. He is a consultant of the law firm Zang, Bergel
& Vines. He has been chairman and judge of the National Court of Appeals of the 
City of Buenos Aires dealing in commercial matters. He is an alternate director 
of Cresud, APSA, Banco Hipotecario S.A. and Nuevas Fronteras S.A.               

     Gabriel A. G. Reznik. Mr. Reznik obtained a degree in civil engineering
from the Universidad de Buenos Aires. He has been working for us since 1992. He 
formerly worked for an independent construction company in Argentina. He is a   
director of APSA, Emprendimientos Recoleta, Inversora Bolivar, Puerto Retiro and
Nuevas Fronteras S.A. and an alternate director of Banco Hipotecario S.A.       

     Thomas Quinn. Mr. Quinn obtained an undergraduate degree from Dartmouth
College and a masters in sciences from Middlebury College. He acts as executive 
director of J.P. Morgan Capital Corporation and associate president of The      
Peabody Group, a sponsor of real estate opportunity funds. He has been          
responsible for the principal real estate investment vehicle of J.P. Morgan     
since 1992 and he                                                               

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also acted as executive director and head of the global real estate consulting  
business of J.P. Morgan. He is a director of TrizecHahn Corporation (Canada),   
Grupo Empresarial Metropolitano S.A. de C.V. (Mexico), BEG S.A. (France) and HPE
Property Holding GmbH (Germany).                                                

    Directors Eduardo S. Elsztain, M. Marcelo Mindlin, A. Gabriel Juejati,
Alejandro Elsztain, Fernando A. Elsztain, Gabriel A. Reznik, Saul Zang, Oscar P.
Bergotto, Juan M. Quintana, Juan C. Quintana Teran, Salvador D. Bergel and      
Ernesto M. Vines qualify as not independent, while the remainder are independent
within the terms of Resolution No. 340 issued by the Comision Nacional de       
Valores.                                                                        

SYSTEMS FOR REMUNERATING DIRECTORS                                

     Under Argentine law, if the compensation of the members of the board of
directors is not established in the bylaws of a company, it should be determined
by the shareholders meeting. The maximum amount of total compensation of the    
members of our board of directors, including compensation for technical or      
administrative permanent activities, cannot exceed 25% of our earnings.         

  That amount should be limited to 5% when there is no distribution of
dividends to shareholders, and will be increased proportionally to the          
distribution. When one or more directors perform special commissions or         
technical or administrative activities, and there are no earnings to distribute,
or they are reduced, the shareholders meeting may approve compensation in excess
of the above mentioned limits.                                                  

  The compensation of our directors for each fiscal year is determined
pursuant to Argentine corporations law, taking into consideration if the        
directors perform additional technical or administrative activities and our     
fiscal year's results. Once the amounts are determined, they are submitted to   
our shareholders for approval at a shareholders' meeting. We have not           
established share option plans, nor retirement, or pension benefits or any other
such remuneration system for our directors except those described. See "Systems 
for Remuneration of Senior Management".                                         

   Fees received by the members of the board of directors for the fiscal
year ended 2001, was Ps. 708,000, as approved by the shareholders meeting held  
on October 19, 2001. The members of our supervisory committee gave up their     
right to collect their fees for the fiscal year ended 2001. The fees            
corresponding to the fiscal year ended June 30, 2002 will be considered by the  
shareholders' meeting that will be held next October.                           

EXECUTIVE COMMITTEE                                               

Pursuant to our bylaws, our day-to-day business is managed by an  
executive committee consisting of five directors among which, there should be   
the chairman, first vice-chairman and second vice-chairman of the board of      
directors. An alternate member, also selected from the board of directors,      
serves on the executive committee in the event of a vacancy. As a result of the 
resignation of Enrique A. Antonini as member of the board of directors and of   
the executive committee, Mr. Oscar Bergotto who was an alternate member assume  
as member of the executive committee. Therefore, the current members of the     
executive committee are Messrs. Eduardo S. Elsztain, M. Marcelo Mindlin, Saul   
Zang, and Oscar Bergotto.                                                       

The executive committee is responsible for the management of the  
day-to-day business delegated by the board of directors in accordance with      
applicable law and our bylaws. Our bylaws authorize the executive committee to: 

      o    designate the managers and establish the duties and compensation of
such managers;                                          

o    grant and revoke powers of attorney on behalf of us;         

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    o    hire, discipline and fire personnel and determine wages, salaries
and compensation of personnel;                          

o    enter into contracts related to our business;                

o    manage our assets;                                           

  o    enter into loan agreements for our business and set up liens to
secure our obligations; and                             

      o    perform any other acts necessary to manage our day-to-day business.

SENIOR MANAGEMENT                                                 

       Our board of directors appoints and removes the senior management. Senior
management performs its duties in accordance with the instructions of our board 
of directors.                                                                   

The following table shows information about our current senior    
management:                                                                     

                                                        [Enlarge/Download Table]


              NAME                     YEARS OLD                  POSITION               CURRENT POSITION HELD  
                                                                                                 SINCE          
---------------------------------- ------------------ ---------------------------------- -----------------------
                                                                                                                
Eduardo S. Elsztain                       41          Chief Executive Officer                     1991          

M. Marcelo Mindlin                        37          Executive Vice-President                    1991          

M. Marcelo Mindlin                        37          Chief Financial Officer                     2001          

Gabriel A. Reznik                         42          Chief Technical Officer                     1992          

A. Gabriel Juejati                        41          Commercial Director                         1994          

Fernando A. Elsztain                      40          Commercial Director                         1994          

Oscar P. Bergotto                         58          Chief Treasury Officer                      1991          


SYSTEMS FOR THE REMUNERATION OF SENIOR MANAGEMENT                 

 We pay our senior management pursuant to a fixed amount established
taking into consideration their background, capacity and experience as well as  
an annual bonus which varies according to their individual performance and our  
overall results.                                                                

       We have entered into executive employment agreements with four executives
and a contract for the participation by management in the capital stock with    
eight executives, the details of which are described below.                     

    We have not set up variable remuneration schemes, nor are there option
plans or retirement or pension plans, nor any other remuneration systems for    
executives than those described above.                                          

COMPENSATION                                                      

On October 30, 1997, our shareholders authorized us to enter into 
executive employment agreements with each of Eduardo S. Elsztain, M. Marcelo    
Mindlin, Saul Zang and Oscar P. Bergotto. These employment agreements were      
executed on December 27, 1997 and approved by our shareholders at an            
extraordinary shareholders meeting on April 7, 1998. Pursuant to these          
employment agreements, Messrs. Elsztain, Mindlin, Zang and Bergotto will serve  
in their current capacity as directors or senior managers and are restricted    
from participating in real estate activities in Argentina that are the same as  

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our business activities. Under these employment agreements, Messrs. Elsztain,   
Mindlin, Zang and Bergotto are each entitled to receive annual compensation in  
the aggregate of approximately Ps. 750,000, subject to an annual 4% increase.   

      The initial term of these employment agreements is seven years, although
they may be terminated prior to their expiration by us or the relevant          
executive. If we terminate the employment agreements without cause, we will be  
liable to the relevant executive for two years of compensation.                 

MANAGEMENT STOCK OWNERSHIP PLAN                                   

 On October 30, 1997, our shareholders authorized us to enter into a
noncontributory management stock ownership plan with eight executive officers,  
pursuant to which the beneficiaries were granted the right to purchase up to 24 
million shares of our common stock at a purchase price equal to Ps. 1.00 per    
share, subject to the implementation of an equity participation agreement. In   
accordance with Argentine law, we established a special purpose trust for       
purpose of this agreement.                                                      

     On October 1, 1998, we issued 21,090,024 shares to be subscribed by the
beneficiaries and, on August 31, 1999, we and the beneficiaries entered into a  
subscription agreement pursuant to which the beneficiaries purchased the        
abovementioned amount of shares at Ps. 1 per share, in the following            
proportions: Eduardo S. Elsztain, 56.66%; M. Marcelo Mindlin, 10.00%; Saul Zang,
5.00%; Ricardo Torres, 6.67%; A. Gabriel Juejati, 6.67%; Gabriel A. G. Reznik,  
5.00%; Fernando A. Elsztain, 6.67%; and Oscar P. Bergotto, 3.33%.               

       Once the participation stock was subscribed, it was placed in a trust, as
laid down in the subscription contract. The trust has an original term of six   
years. According to the terms of this stock ownership plan and the trust,       
beneficiaries are not entitled to receive any distributions (either in the form 
of shares, cash or other) from the trust during its term, although beneficiaries
are allowed to cause the trust to sell their designated shares of common stock  
held by the trust in certain cases. Each of the beneficiaries financed the      
purchase of his respective participation stock with funds provided by certain   
loan agreements signed with the trust on August 31, 1999. The trust contemplated
the possibility of disbursing the assets of the trust to the beneficiaries on   
the sixth anniversary of the inception of the trust on a pro rata basis. The    
trust assets shall be distributed according to the percentage of participation  
stock held by each of the beneficiaries under the participation contract.       

    On May 31, 2001, we entered into an agreement with Ricardo Torres, our
former chief financial officer, pursuant to which we and Ricardo Torres set     
forth our mutual agreement with respect to all matters relating to the Ricardo  
Torres's resignation and cessation of employment. In consideration of the mutual
promises and agreements we and Mr. Torres agreed that Mr. Torres would resign as
chief financial officer, we would pay Mr. Torres a lump sum cash amount equal to
Ps. 95,000 and would also be entitled to continued coverage for him and his     
dependents under our medical and dental plans for a period of up to six months  
following his termination.                                                      

On May 24, 2001, Mr. Torres entered into a purchase agreement with
Eduardo S. Elsztain, one of our principal shareholders and also a beneficiary   
under the stock ownership plan, pursuant to which Mr. Torres sold his shares in 
the trust at a fixed price per share below the fair market value per share at   
the date of the purchase agreement.                                             

     As the result of the sale and reallocation of Mr. Torres' shares in the
trust, the interests of Mr. Eduardo S. Elsztain and Mr. Saul Zang in the shares 
in the trust increased to 61.66% and 6.67%, respectively.                       

SUPERVISORY COMMITTEE                                             

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   The supervisory committee (Comision Fiscalizadora) is responsible for
reviewing and supervising our administration and affairs, and verifying         
compliance with the bylaws and the resolutions adopted at shareholders'         
meetings. The members of the supervisory committee, the syndics, are appointed  
at the annual general ordinary shareholders' meeting for a term of one year. The
supervisory committee is composed of 3 syndics and 3 alternate syndics: Jose D. 
Abelovich, Marcelo H. Fuxman and Martin Barbafina; Ruben O. Mosi, Carlos A.     
Rebay and Julio P. Naveyra.                                                     

       Set forth below is a brief biographical description of each member of our
supervisory committee, who were elected in our annual general ordinary          
shareholders' meeting held on October 19, 2001:                                 

       JOSE D. ABELOVICH. Mr. Abelovich obtained a degree in accounting from the
Universidad de Buenos Aires. He is a founding member and partner of Abelovich,  
Polano and Associates/SC International, a public accounting firm in Argentina.  
Formerly, he had been a manager of Harteneck, Lopez y Cia/PricewaterhouseCoopers
and has served as a senior advisor in Argentina for the United Nations and the  
World Bank. He is a member of the supervisory committees of APSA, SAPSA, Hoteles
Argentinos and Inversora Bolivar.                                               

    MARCELO H. FUXMAN. Mr. Fuxman obtained a degree in accounting from the
Universidad de Buenos Aires. He is a partner of Abelovich, Polano and           
Associates/SC International, a public accounting firm in Argentina. He is also a
member of the supervisory committee of APSA, SAPSA and Inversora Bolivar.       

      MARTIN BARBAFINA. Mr. Barbafina obtained a degree in accounting from the
Universidad Catolica Argentina. He is a partner of PricewaterhouseCoopers. He is
also a member of the supervisory committee of APSA, Cresud, Metrovias S.A. and  
Grupo Concesionario del Oeste.                                                  

RUBEN O. MOSI. Mr. Mosi obtained a degree in accounting from the  
Universidad de Buenos Aires. He is a partner of PricewaterhouseCoopers. He is   
also a member of the supervisory committees of Edesal S.A., Papelera del Plata  
S.A. and Terminal Murchison Roman S.A.                                          

     CARLOS A. REBAY. Mr. Rebay obtained a degree in accounting and a degree
in administration from the Universidad Argentina de la Empresa. He is a partner 
of PricewaterhouseCoopers. He is also a member of the supervisory committees of 
Massalin Particulares S.A., Hart S.A., Tapiales S.A. and AT&T Argentina S.A.    

    JULIO P. NAVEYRA. Mr. Naveyra obtained a degree in accounting from the
Universidad de Buenos Aires. He is a retired partner of PricewaterhouseCoopers. 
He is member of the supervisory committees of APSA, Cresud, La Nacion and       
Johnson & Johnson of Argentina.                                                 

   All of the members of the supervisory committee qulify as independent
under the terms of Resolution 340 issued by the Comision Nacional de Valores,   
although they have provided remunerated professional assistance to companies    
covered by section 33 of Law No. 19.550.                                        

                                                                              65

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STOCK MARKET INFORMATION

NEW YORK STOCK EXCHANGE                                                         

   Our Global Depositary Shares, each representing 10 common shares, are
listed and traded on the NYSE under the trading symbol "IRS". The Global        
Depositary Shares began trading on the NYSE on December 20, 1994 and were issued
by the Bank of New York, Inc., acting as Global Depositary Shares Depositary. It
should not be assumed, however, that the Global Depositary Shares will actually 
trade at a multiple of 10 times the price per common share. The following table 
shows, for the periods indicated, the high and low closing sales price of the   
Global Depositary Shares on the NYSE.                                           

         FISCAL YEAR                                 US DOLLAR PER GDS
                                             HIGH                  LOW
                                             ------------          -----------
         2002                            16 2/25               3 33/50
    2001                            22 2/9                13
        2000                            31 1/4                19 6/7
    1999                            33 1/2                16
        1998                            40 1/3                25 1/5
        1997                            38 1/3                24 1/5

         FISCAL QUARTER                              US DOLLAR PER GDS
                                             HIGH                  LOW
                                             ------------          -----------
2002                                                
       4th quarter                     6 1/10                3 2/3
       3rd quarter                     6 2/7                 4 1/2
        2nd quarter                     9 3/4                 4 9/10
       1st quarter                     16                    9 4/5
2001                                                
    4th quarter                     17 1/9                13
        3rd quarter                     20 1/2                14 1/2
        2nd quarter                     20 59/64              14 1/2
        1st quarter                     22 2/9                20 1/2
2000                                                
        4th quarter                     28 1/3                19 6/7
        3rd quarter                     31 1/4                26 5/8
        2nd quarter                     29 3/7                24 2/3
        1st quarter                     28                    24 1/3

         MONTH                                       US DOLLAR PER GDS
                                             HIGH                  LOW
                                             ------------          -----------
        September (FY 2003)             6 1/4                 4 3/10
         August (FY 2003)                4 1/2                 3 19/20
        July (FY 2002)                  5                     4 1/10
       June (FY 2002)                  5                     3 2/3
   May (FY 2002)                   5 2/7                 5
       April (FY 2002)                 5 3/5                 4 4/5
       March (FY 2002)                 6 1/10                4 3/5
       February (FY 2002)              5 1/3                 4 1/4
       January (FY 2002)               6 2/7                 4 1/3

------------------                                                              
Source: Bloomberg.                                                              

                                                                              66

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BUENOS AIRES STOCK EXCHANGE                                                     

   Our common shares are listed and traded on the Buenos Aires Stock
Exchange under the trading symbol "IRSA". The shares began trading on the Buenos
Aires Stock Exchange in the year 1948. The following table shows, for the       
periods indicated, the high and low closing sales price of our common shares on 
the Buenos Aires Stock Exchange. On October 9, 2002, the closing price for our  
common shares on the Buenos Aires Stock Exchange was, approximately, Ps. 2.07   
per share.                                                                      

FISCAL YEAR                        PESOS PER SHARE  
                                 HIGH                  LOW
                                -------------        -------------
    2002                          1.88                  0.58
    2001                          2.23                  1.30
    2000                          3.15                  1.99
    1999                          3.37                  1.63
    1998                          4.08                  2.52
    1997                          3.84                  2.43

FISCAL QUARTER                     PESOS PER SHARE  
                                 HIGH                  LOW
                                -------------        -------------
2002                                                
    4th quarter                   1.88                  1.26
    3rd quarter                   1.45                  0.76
    2nd quarter                   0.97                  0.58
    1st quarter                   1.59                  1.00
2001                                                
    4th quarter                   1.71                  1.30
    3rd quarter                   2.06                  1.47
    2nd quarter                   2.08                  1.46
    1st quarter                   2.23                  2.06
2000                                                
    4th quarter                   2.84                  1.99
    3rd quarter                   3.15                  2.66
    2nd quarter                   2.95                  2.45
    1st quarter                   2.82                  2.44

MONTH                              PESOS PER SHARE  
                                 HIGH                  LOW
                                -------------        -------------
    September (FY 2003)           2.25                  1.47
    August (FY 2003)              1.70                  1.47
    July (FY 2002)                1.72                  1.57
    June (FY 2002)                1.87                  1.49
    May (FY 2002)                 1.88                  1.65
    April (FY 2002)               1.7                   1.45
    March (FY 2002)               1.45                  1.26
    February (FY 2002)            1.27                  1.00
    January (FY 2002)             1.03                  0.76

----------------                                                                
Source: Bloomberg.                                                              

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 IRSA INVERSIONES Y REPRESENTACIONES
SOCIEDAD ANONIMA
AND SUBSIDIARIES

BOARD REPORT
 AND
 CONSOLIDATED FINANCIAL STATEMENTS
 For the years ended
June 30, 2002 and 2001

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA
AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS AS OF JUNE 30, 2002 AND 2001

 In thousands of pesos

                                                                [Download Table]

====================================================================================
                                                      June 30,         June 30,     
                                                        2002             2001       

                                                  (Notes 2 and 3)  (Notes 2 and 3)  
                                                  ----------------------------------
                                                                                    
ASSETS                                                                              
------                                                                              
CURRENT ASSETS                                                                      
--------------                                                                      
Cash and banks                                              24,831           10,530 
Investments (Note 7)                                        36,796           89,707 
Mortgages and leases receivables                            12,004           59,928 
Other receivables (Note 5)                                  38,547           36,927 
Inventory (Note 6)                                          24,130           24,783 
                                                  ----------------------------------
TOTAL CURRENT ASSETS                                       136,308          221,875 
                                                  ----------------------------------

NON-CURRENT ASSETS                                                                  
------------------                                                                  
Mortgages receivables                                        3,135           44,326 
Other receivables (Note 5)                                  89,621           34,764 
Inventory (Note 6)                                          46,558           67,399 

Investments (Note 7)                                       526,348          699,893 

Fixed assets (Note 8)                                      338,794          419,375 

Intangible assets                                            3,951            6,917 
                                                  ----------------------------------
TOTAL NON-CURRENT ASSETS                                 1,008,407        1,272,674 
                                                  ----------------------------------
TOTAL ASSETS                                             1,144,715        1,494,549 
====================================================================================

                                                                [Download Table]

=================================================================================== 
                                                     June 30,         June 30,      
                                                       2002             2001        

                                                 (Notes 2 and 3)  (Notes 2 and 3)   
                                                 -----------------------------------
                                                                                    
LIABILITIES                                                                         
-----------                                                                         
CURRENT LIABILITIES                                                                 
-------------------                                                                 

Trade accounts payable                                     12,224           10,831  
Customer advances                                           1,931            4,300  
Short term-debt (Note 9)                                  564,739          350,465  
Salaries and social security charges                        1,024            1,923  
Taxes payable                                              12,598            8,036  

Other liabilities (Note 10)                                13,544           10,106  
                                                 ---------------------------------- 
TOTAL CURRENT LIABILITIES                                 606,060          385,661  
                                                 ---------------------------------- 

NON-CURRENT LIABILITIES                                                             
-----------------------                                                             
Trade accounts payable                                          -              374  

Long term-debt (Note 9)                                       142           26,012  
Customer advances                                               -              360  
Other liabilities (Note 10)                                 2,879            7,751  
                                                 ---------------------------------- 
TOTAL NON-CURRENT LIABILITIES                               3,021           34,497  
                                                 ---------------------------------- 
TOTAL LIABILITIES                                         609,081          420,158  
                                                 ---------------------------------- 
Minority interest                                          75,218          114,356  
                                                 ---------------------------------- 
SHAREHOLDERS'  EQUITY                                     460,416          960,035  
                                                 ================================== 
TOTAL LIABILITIES AND SHAREHOLDERS'  EQUITY             1,144,715        1,494,549  
=================================================================================== 

The accompanying notes are an integral part of these consolidated financial     
statements.                                                                     

                                               Eduardo Sergio Elsztain
                                               President

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA
AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF INCOME
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001

 In thousands of pesos

                                                        [Enlarge/Download Table]

=======================================================================================================================
                                                                                       June 30,           June 30,     
                                                                                         2002               2001       

                                                                                   (Notes 2 and 3)   (Notes 2 and 3)   
                                                                                                                       
                                                                                ---------------------------------------
Mortgages, leases and services                                                            211,319             339,843  
Costs of sales, leases and services                                                      (121,355)           (172,024) 
                                                                                ---------------------------------------
GROSS INCOME                                                                               89,964             167,819  
                                                                                ---------------------------------------
Selling expenses                                                                          (34,332)            (33,748) 
Administrative expenses                                                                   (37,643)            (50,740) 
                                                                                ---------------------------------------
SUBTOTAL                                                                                  (71,975)            (84,488) 
                                                                                ---------------------------------------
Loss on purchasers rescissions of sales contracts                                              27                (14)  
Loss from operations and holding of real estate assets (Note 11)                          (64,956)             (6,305) 
                                                                                ---------------------------------------
OPERATING INCOME (NOTE 4)                                                                (46,940)              77,012  
                                                                                ---------------------------------------
Financial results, net (Note 12)                                                         (432,220)           (110,302) 
Net income in related companies                                                           (1,967)            (10,323)  
Other income and expenses, net  (Note 13)                                                  (8,511)             (5,624) 
                                                                                ---------------------------------------
LOSS BEFORE TAXES (NOTE 4)                                                               (489,638)            (49,237) 
                                                                                ---------------------------------------
Income tax and asset tax                                                                   (9,981)             (5,063) 
Extraordinary loss                                                                               -             (5,653) 
                                                                                =======================================
LOSS FOR THE YEAR (NOTE 4)                                                               (499,619)            (59,953) 
=======================================================================================================================

The accompanying notes are an integral part of these consolidated financial     
statements.                                                                     

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA
AND SUBSIDIARIES

 STATEMENTS OF CONSOLIDATED CASH FLOWS (1)
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001

 In thousands of pesos

                                                        [Enlarge/Download Table]

================================================================================================================================
                                                                                                June 30,         June 30,       
                                                                                                  2002             2001         
                                                                                            (Notes 2 and 3)   (Notes 2 and 3)   
                                                                                            ------------------------------------
                                                                                                                                
 CASH FLOWS FROM OPERATING ACTIVITIES:                                                                                          
         Loss for the year                                                                         (499,619)          (59,953)  

         ADJUSTMENTS TO RECONCILE NET LOSS TO CASH FLOW FROM OPERATING ACTIVITIES:                                              
         o        Equity in earnings of affiliated companies                                         11,111            (6,471)  
         o        Minority interest in related companies                                             (5,118)            1,459   
         o        Results from the sale of fixed assets                                                   -               (29)  
         o        Allowances and provisions                                                           1,314               994   
         o        Amortization and depreciation                                                      21,033            23,103   
         o        Loss from operations and holding of real estate assets                             41,631             5,708   
         o        Financial results                                                                 301,073            39,912   
         o        Income tax                                                                          6,882             3,140   
         CHANGES IN ASSETS AND LIABILITIES:                                                                                     
         o        Increase in current investments                                                   (16,103)          (34,740)  
         o        Decrease in non-current investments                                                   982                 -   
         o        Decrease in mortgages and leases receivables                                       37,966            15,663   
         o        Increase in other receivables                                                     (13,377)           (5,849)  
         o        Decrease in inventory                                                              52,758            52,188   
         o        Decrease in intangible assets                                                           -               593   
         o        Increase (Decrease) in taxes payable, salaries and social                                                     
                    security and customer advances                                                      984           (12,762)  
         o        Increase in accounts payable                                                        8,289             2,578   
         o        Increase in accrued interest and exchange loss                                     72,222            54,957   
         o        Cash dividends received                                                             2,496            19,243   
         o        Increase (Decrease) in other liabilities                                           22,800            (3,840)  
                                                                                            ------------------------------------
                        NET CASH PROVIDED BY OPERATING ACTIVITIES                                    47,325            95,894   
                                                                                            ------------------------------------
 CASH FLOWS FROM INVESTING ACTIVITIES:                                                                                          
         o        Decrease from equity interest in subsidiary companies and equity investees        119,933           134,074   
         o        Payment for acquisition of subsidiary companies and equity investees              (19,322)          (52,291)  
         o        Payment for acquisition of undeveloped parcels of land                             (2,952)           (2,214)  
         o        Loans granted to related parties                                                  (94,077)                -   
         o        Purchase and improvements of fixed assets                                         (21,058)           (6,813)  
                                                                                            ------------------------------------
                        NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES                         (17,476)           72,756   
                                                                                            ------------------------------------
 CASH FLOWS FROM FINANCING ACTIVITIES:                                                                                          
         o        Purchase of treasury stock                                                              -           (80,431)  
         o        Minority shareholders contribution                                                  3,059                 -   
         o        Proceeds from short-term and long-term debt                                       151,326           324,508   
         o        Payment of short-term and long-term debt                                         (187,453)         (385,590)  
         o        Increase in intangible assets                                                      (3,033)           (4,802)  
         o        Payment of seller financing                                                        (1,766)          (18,332)  
                                                                                            ------------------------------------
        NET CASH USED IN  FINANCING ACTIVITIES                                                      (37,867)         (164,647)  
                                                                                            ------------------------------------
        NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS                                         (8,018)            4,003   
        CASH AND CASH EQUIVALENTS AS OF BEGINNING OF YEAR                                            33,271            29,275   
                                                                                            ------------------------------------
        CASH AND CASH EQUIVALENTS AS OF END OF YEAR                                                  25,253            33,278   
================================================================================================================================

(1) Includes cash, banks and investments with a realization term not exceeding  
three months. The accompanying notes are an integral part of these consolidated 
financial statements.                                                           

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA
AND SUBSIDIARIES

 STATEMENTS OF CONSOLIDATED CASH FLOWS (CONTINUED)
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001
 In thousands of pesos

                                                        [Enlarge/Download Table]


                                                                                         June 30,        June 30,     
                                                                                           2002             2001      
                                                                                      (Notes 2 and 3)  (Notes 2 and 3)
                                                                                      --------------------------------
                                                                                                                      

SUPPLEMENTAL CASH FLOW INFORMATION                                                                                    

NON-CASH ACTIVITIES:                                                                                                  

o    Increase in inventory through a decrease in fixed assets                             36,860         23,809       
o    Decrease in inventory through an increase in intangible assets                            -            595       
o    Increase in fixed assets through a decrease in inventory                                  -          2,408       
o    Decrease in mortgages receivable through the trust                                   20,796              -       
o    Increase in investments through a decrease in mortgages and leases receivables       20,200              -       
o    Increase in other receivables through a decrease in mortgages receivables             2,500              -       
o    Increase in deffered gain through a decrease in current investments                       -          2,328       
o    Increase in other current receivables through a decrease in current investments           -         12,520       
o    Increase in Minority interest through a drecrease in long-term debt                       -            293       
o    Decrease in non-current investments through an increase in other liabilities         33,919              -       
o    Decrease in Short and long term-debt though a decrease in investments                 5,620              -       

                                                         Eduardo Sergio Elsztain
                                                         President

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA
AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001
 In thousands of pesos

NOTE 1:  ARGENTINE ECONOMIC SITUATION AND ITS IMPACT ON THE ECONOMIC AND        
     FINANCIAL POSITION OF IRSA INVERSIONES Y REPRESENTACIONES S.A. (THE
"COMPANY")                                                    

       Argentina is immersed in a difficult economic climate. The prevailing
         indicators were a significant public debt burden, a financing system in
      crisis, country risk levels far above normal average and a more than
       four-year economic recession. This situation has led to a significant
      decrease in products and services consumption and an increase in the
        unemployment level. These circumstances have affected the Government's
ability to comply with existing commitments and access to bank
financing.                                                    

    As from December 3, 2001 measures were issued to restrict the free
  availability and circulation of cash and the transfer of foreign
       currency abroad. Subsequently, the Government declared default on the
external debt.                                                

  On January 6, 2002 after a political crisis that resulted in the
         resignation of two presidents, the Government enacted Law 25561 (Law of
        public emergency and exchange system reform) that involved an in-depth
  change of the prevailing economic model and the amendment of the
     Convertibility Law in force since March 1991. In early February the
Government announced new economic measures though Decree 214  
    (Restructuring of the financial system) dated February 3, 2002 and
    Decree 260 (Exchange Regime) dated February 8, 2002, substantially
         modifying some of the measures implemented by the Public Emergency Law.
        These decrees are being complemented by other regulations being issued
        by the various control agencies, some of which are been pending at the
     date of the issuance of these financial statements. In addition, on
   April 24, 2002 the Government signed an agreement with provincial
governors, which, together with other changes to the National 
        Administration, will lay down the basis for further measures that have
yet to be issued or fully implemented.                        

      Listed below are some of the measures adopted by the Government that
       are in force at the date of filing these financial statements and the
     effect they have on the Company's economic and financial situation.

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AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 1:  (continued)                                                            

Exchange system                                               
---------------                                               

On February 8, 2002 a single free exchange market system was  
      established through which all transactions involving the exchange of
      currency are to be traded at a rate of exchange to be freely agreed,
     observing the requirements to be laid down by the Argentine Central
         Bank. At present certain transfers abroad of a financial nature require
the prior approval of the Central Bank and there are certain  
        requirements for settling and collecting foreign currency arising from
exports.                                                      

Deposits in financial institutions                            
----------------------------------                            

    As from February 3, 2002 deposits in U.S. dollars or other foreign
        currencies in Argentine financial institutions were converted to pesos
     at the exchange rate of Ps. 1.4 per US$ 1 or its equivalent in such
         other currency. Furthermore, there are restrictions on the availability
         of certain balances in current accounts and savings accounts in dollars
    and fixed term deposits in pesos or dollars. The terms of ultimate
         repayment of bank deposits to depositors have not been finalized and is
         not yet known in what form such payment, or other compensation, will be
      made. As from February 3, 2002 a reference stabilization index (CER)
        and an interest rate were to be applied to these rescheduled deposits.
         The CER is an index that measures the daily rate of change derived from
       the monthly change in the Consumer Price Index (CPI) published by the
         INDEC. The application of the CER for certain transactions has met with
    substantial resistance in Argentina and its application may change
     substantially in the future. In addition, the possibility exists of
      transforming part or all of the rescheduled deposits into Government
       Bonds or other financial institutions. If the depositors do not elect
         to receive Government Bonds, they will receive bonds issued by the Bank
that will observe the pre-existing conditions.                

Financial debts in foreign currency                           
-----------------------------------                           

    Debts in U.S. dollars or other foreign currencies in the Argentine
         financial system were converted to pesos at the rate of exchange of Ps.
        1 per US$ 1 or its equivalent in another currency. As from February 3,
         2002 a reference stabilization index (CER) and an interest rate will be
applied to these debts.                                       

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA
AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 1:  (continued)                                                            

Credits and debts not related to the financial system         
-----------------------------------------------------         

     The obligation to pay money denominated in dollars or other foreign
       currency that are not related to the financial system, whatever their
       origin or nature, were converted to pesos at the exchange rate of $ 1
     to US$ 1 or its equivalent in such other foreign currency. To these
  balances must be applied a reference stabilization index as from
         February 3, 2002. If through this provision, the resulting value of the
         item, good or service is higher or lower at the time of payment, either
    of the parties can request a fair readjustment of the price. If no
 agreement is reached, the case will be submitted to the Courts.

       Deferment of the deduction of the exchange difference from income tax
       ---------------------------------------------------------------------

     The negative net results that originate in this devaluation will be
     deductible from income tax as from the future five financial years.

      Recognition of the effects of changes in the purchasing power of the
      --------------------------------------------------------------------
currency                                                      
--------                                                      

    As established by Resolution 3/2002 of the Professional Council in
      Economic Sciences of the Autonomous City of Buenos Aires, Resolution
         240/02 of the Argentine Federation of Professional Councils in Economic
        Sciences and Resolution No. 415 of the National Securities Commission,
       as from January 1, 2002 the financial statements consider the effects
       of changes in the purchasing power of the currency in accordance with
 the guidelines of Technical Pronouncement No.6 of the Argentine
       Federation of Professional Councils in Economic Sciences. Note 1.b to
         the individual financial statements provides details of this situation.

Impact of the economic situation on the Company               
-----------------------------------------------               

   The impact generated by all these measures adopted to date by the
       Government on the financial situation of the Company at June 30, 2002
   was calculated according to the evaluations and estimates made by
      Management at the date of preparing the financial statements. Future
        actual results could differ from the evaluations and estimates made at
        the date of preparing these financial statements and these differences
         could be significant. Therefore, the Company's financial statements may
     not report all the adjustments that could result from these adverse
         conditions. Furthermore, at this time it is not possible to foresee the
        future development of the country's economy or its consequences on the
     economic and financial situation of the Company. Thus, any decision
that must be made on the basis of                             

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 1:  (continued)                                                            

         othese financial statements must take into account the effects of these
   measures and their future development and the Company's financial
statements must be considered in the light of these uncertain 
circumstances.                                                

       As mentioned in Note 6 to the individual financial statements at June
   30, 2002, the Company was unable to meet certain financial ratios
    required by the negotiable obligations, so that the holders of the
       notes could require accelation of maturities. As mentioned in Note 15
  to the consolidated financial statements, the subsidiary Hoteles
      Argentinos S.A. has not paid principal installments amounting to US$
      300 thousand, with original maturities set for April 29 and July 29,
       2002, and an interest installment amounting to US$ 127 thousand which
       fell due on July 29, 2002, under the long-term loan agreement secured
        by a mortgage entered into with Bank Boston N.A., Buenos Aires branch.

       As a result of the current economic situation, the lack of credit and
       the crisis of the Argentine financial system, it is probable that the
      Company will be unable to meet its obligations when due. At present,
        Management is negotiating the mentioned liabilities.. Although Company
        Management understands that there are feasible alternatives, it is not
      possible to insure that they will be successful in implementing them
         and whether, once implemented, the Company can fulfill its obligations.
  Management estimates that the net funds provided by the issue of
        negotiable obligations convertible into shares described in Note 14 to
 the individual financial statements will be appropriated to the
   financing or partial settlement of the debts mentioned in Note 6.

       The financial statements have been prepared assuming that the Company
        will continue as a going concern. Therefoe, these financial statements
do not include the effects of a possible adjustment or        
       reclassification, if any, that might be required if the Company could
     be obliged to sell its assets and settle its liabilities, including
   contingencies in conditions different to the normal course of its
business.                                                     

NOTE 2:  BASIS OF CONSOLIDATION - CORPORATE CONTROL                             

a) Basis of consolidation                                     
----------------------                                  

        The consolidated financial statements have been prepared following the
         guidelines of Technical Resolution No. 4 of the Argentine Federation of
        Professional Councils of Economic Sciences (F.A.C.P.C.E.), pursuant to
which the Balance Sheets as of June 30, 2002 and 2001 of IRSA 
    Inversiones y Representaciones Sociedad Anonima, the Statements of
Income                                                        

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 2:  (continued)                                                            

     included in Note 14, and the Statements of Cash Flows for the years
     then ended were consolidated with the financial statements of those
         companies in which has the necessary votes to exercise control over the
corporate decisions.                                          

  All significant intercompany balances and transactions have been
eliminated in consolidation.                                  

      The following table shows the data concerning the corporate control:

                                                        [Enlarge/Download Table]

                                                                     June 30,             June 30,    
                                                                       2002                 2001      
                                                              ----------------------------------------
                                                                         DIRECT OR INDIRECT % OF      
                              COMPANIES                                      VOTING SHARES            
------------------------------------------------------------  ----------------------------------------
                                                                                                      
IRSA International Ltd (1)                                                  -               100,00    
Ritelco S.A.(1)                                                        100,00                    -    
Home Financing S.A.                                                         -               100,00    
Palermo Invest S.A.                                                     66,67                66,67    
Abril S. A.                                                             83,33                83,33    
Pereiraola S. A.                                                        83,33                83,33    
Baldovinos S. A.                                                        83,33                83,33    
Hoteles Argentinos S. A.                                                80,00                80,00    

 (1) In accordance with mentioned in Note 16 to the Consolidated
   Financial Statements, as of June 30, 2002 the Company decided the
liquidation anticipated of IRSA International Ltd.            

        The consolidated statements of income were prepared on a proportionate
 consolidation basis. As from July 1, 1996, the Company uses the
        "proportionate-consolidation method" of accounting for the investments
     in which the Company exercises control and other jointly controlled
       investments. This method has not been used for balance sheet and cash
    flows purposes. All notes to the consolidated financial statements
 relating to income-statement items have been also prepared on a
proportionate-consolidation basis. The Company calculates the 
         proportionate-consolidation method by applying its percentage ownership
        interest to the financial statements of its equity method investments.
   The Company considers this method more appropriately reflects the
 Company's results of operations and the integration of its core
        businesses. The use of the proportionate-consolidation method has been
approved by the CNV. Although the use of the                  
        proportionate-consolidation method as compared to the equity method of
         accounting from a financial presentation perspective impacts almost all
       areas of the Company's consolidated statements of income, it does not
         impact the Company's consolidated shareholders' equity or net earnings.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 2:  (continued)                                                            

Note 14 to our consolidated financial statements presents our 
 statements of income for the years ended June 30, 2002 and 2001
        prepared following the guidelines of the Technical Resolution No. 4 of
        the Argentine Federation of Professional Councils of Economic Sciences
  (F.A.C.P.C.E.), reporting (i) the jointly-controlled investments
 accounted for by the equity method, with the earnings or losses
  included as earnings or losses from equity investments, and (ii)
     minority interest in earnings or losses of controlled subsidiaries.

         A description of the jointly controlled investments accounted for under
 the proportionate consolidation method is presented as follows:

                                                        [Enlarge/Download Table]

JOINTLY CONTROLLED COMPANIES                                                            
----------------------------------------------------------------------------------------
                                                             2002               2001    
                                                                                        
Brazil Realty S.A. Empreendimentos e                                                    
Participacoes o "Brazil Realty" (1)                             - %             49,27 % 
Alto Palermo S.A. ("APSA")                                  49,69 %             47,42 % 
Llao Llao Resort S.A.                                       50,00 %             50,00 % 
Argentine Realty S.A.                                       50,00 %             50,00 % 
Buenos Aires Realty S.A.                                    50,00 %             50,00 % 
Buenos Aires Trade & Finance Center S.A.                    50,00 %             50,00 % 
Puerto Retiro S.A.                                          33,33 %             33,33 % 

   (1) During February 2002, the Company sold its equity interest in
Brazil Realty                                                 

b) Consideration of the effects of inflation                  

   The financial statements have been prepared in constant currency,
         reflecting the overall effects of inflation through August 31, 1995. As
      from that date, in accordance with professional accounting standards
     and the requirements of the control authorities, restatement of the
        financial statements was discontinued until December 31, 2001. As from
  January 1, 2002, in accordance with Resolution No. 3/2002 of the
     Professional Council in Economic Sciences of the Autonomous City of
Buenos Aires and Resolution No. 415 of the National Securities
  Commission, the effects of inflation are being recognized in the
       financial statements. To this end, the restatement method established
         by Technical Pronouncement No. 6 of the F.A.C.P.C.E. has been followed.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 2:  (continued)                                                            

       As a consequence of the above, the Company's financial statements are
         presented in constant currency of June 30, 2002, having considered that
      the accounting measurements restated by the change in the purchasing
       power of the currency until August 31, 1995 and those arising between
      that date and December 31, 2001 are stated in currency of the latter
date.                                                         

         The above restatement was made applying the coefficients prepared based
on the domestic wholesale price index.                        

 The Company used a conversion factor to restate the comparative
       financial statements in constant Argentine pesos of June 30, 2002 for
comparative purposes.                                         

c. Reclassifications                                          

       Certain reclassifications of prior year information have been made to
conform with the current year presentation.                   

d. Disposition of businesses                                  

      Sales in jointly controlled affiliated companies incorporated abroad
      --------------------------------------------------------------------

       i)    Latin American Econetworks N.V (LAE) : On November 7, 2001, the
               Company sold its interest in LAE for a total consideration of US$
              5,250. The price was fully collected on that date. In July 2000,
               this company was conceived as a developer of software, technology
and internet services.                            

   ii)   Brazil Realty S.A. Empreendimentos e Participacoes ("Brazil
              Realty"): As established by the agreement signed on February 28,
             2002 and the First Amendment dated May 3, 2002, between Ritelco
          S.A, IRSA International Limited, IRSA and Creed Holding Ltd,
               through its subsidiary Ritelco S.A., the Company sold 100% of its
               participation in Brazil Realty for US$ 44,187 thousand, which had
            been collected in full at the date of issue of these financial
            statements. This operation generated a net gain amounting to $
            31,514 which is shown in the Statement of Income as "Gain from
             operations and holding of real estate assets" at June 30, 2002.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 2:  (continued)                                                            

       iii)  Fondo de Valores Inmobiliarios S.A.C.A. ( "FVI" ) and Venezuela
           Invest Ltd. ( "Venezuela Invest"): As a result of a series of
         related transactions, in December 2000 the Company sold its
            participation in Venezuela Invest Ltd. and in Fondo de Valores
               Inmobiliarios S.A.C.A., Company subsidiaries in Venezuela, for an
               aggregate amount of US$ 67,000 thousand. This operation generated
          a loss of $ 966 thousand, which is shown in the Statement of
            Income at June 30, 2001 as Loss from operations and holding of
real estate assets".                              

NOTE 3:  SIGNIFICANT ACCOUNTING POLICIES                                        

       The financial statements of the subsidiaries mentioned in Note 2 have
been prepared on a consistent basis with those applied by IRSA
Inversiones y Representaciones Sociedad Anonima.              

a. Jointly controlled affiliated companies incorporated abroad
   -----------------------------------------------------------

     The financial statements of the related companies under joint
           control set up abroad, used for application of the equity method of
   accounting to value the investment in those companies, were
       converted into Argentine pesos at the year-end rate of exchange
          based on the financial statements of those companies stated in the
          currency of the country of origin. The conversion method envisages
         the conversion of monetary assets and liabilities at the exchange
           rate in force at the end of each period and the non-monetary assets
         and liabilities and equity accounts based on amounts adjusted for
          inflation, if applicable, at the exchange rate in force at the end
           of each period. Average exchange rates were used for the conversion
         of financial statements that reflect the results for the periods.
    The net gain/loss for monetary conversion is included in the
Financial results, net.                                 

          Since March 31, 1999, as a consequence of changes in the variables
          to measure fluctuations in domestic prices, and the performance of
   the Brazilian currency compared to the Argentine peso, IRSA
           International Limited has decided to value its investments in fixed
            assets and other intangible assets that cannot be disposed of by its
          subsidiary, Brazil Realty S.A. Empreendimentos e Participacoes, at
 their original cost in pesos, less applicable accumulated
   depreciation, following the calculation method laid down by
         Technical Resolution No. 13, which was approved by the March 1999
          Resolution of the Administrative Board of the Argentine Federation
of Professional Councils in Economic Sciences.          

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 3:  (continued)                                                            

b. Shares and options of Banco Hipotecario S.A.               
--------------------------------------------            

    The shares in Banco Hipotecario S.A. held by Ritelco S.A. (a
           wholly-owned subsidiary) have been valued at their quotation at the
            end of the year, less estimated selling expenses, while options were
           valued at restated cost as mentioned in Note 1.b) to the individual
financial statements.                                   

Revenue Recognition                                     
-------------------                                     

     See Note 4 for details on the Company's business segments. As
          discussed in Note 2.a., the consolidated statements of income were
         prepared on a proportionate consolidation basis. The Company uses
      the "proportionate-consolidation method" of accounting for the
            investments in which the Company exercises control and other jointly
controlled investments.                                 

o Leases and services from shopping center operations   
--------------------------------------------------- 

          Leases with tenants are accounted for as operating leases. Tenants
           are generally charged a rent, which consists of the higher of (i) a
           monthly base rent (the "Base Rent") and (ii) a specified percentage
          of the tenant's monthly gross retail sales (the "Percentage Rent")
           (which generally ranges between 4% and 8% of tenant's gross sales).
           Furthermore, pursuant to the rent escalation clause in most leases,
            a tenant's Base Rent generally increases between 4% and 7% each year
            during the term of the lease. Minimum rental income is recognized on
a straight-line basis over the term of the lease.       

            Certain lease agreements contain provisions, which provide for rents
        based on a percentage of sales or based on a percentage of sales
      volume above a specified threshold. The Company determines the
           compliance with specific targets and calculates the additional rent
        on a monthly basis as provided for in the contracts. Thus, these
         contingent rents are not recognized until the required thresholds
are exceeded.                                           

     Generally, the Company's lease agreements vary from 36 to 120
           months. Law No. 24,808 provides that tenants may rescind commercial
            lease agreements after the initial six months, upon not less than 60
         days' written notice, subject to penalties which vary from one to
          one and a half months rent if the tenant rescinds during the first
       year of its lease, and one month of rent if the tenant rescinds
after the first year of its lease.                      

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NOTE 3:  (continued)                                                            

          The Company also charges its tenants a monthly administration fee,
          prorated among the tenants according to their leases, which varies
from shopping center to shopping center, relating to the
 administration and maintenance of the common area and the
  administration of contributions made by tenants to finance
        promotional efforts for the overall shopping centers operations.
           Administration fees are recognized monthly when earned. In addition
    to rent, tenants are generally charged "admission rights", a
        non-refundable admission fee that tenants may be required to pay
          upon entering into a lease and upon lease renewal. Admission right
        is normally paid in one lump sum or in a small number of monthly
installments. Admission rights are recognized using the 
  straight-line method over the life of the respective lease
           agreements. Furthermore, the lease agreements generally provide for
          the reimbursement of real estate taxes, insurance, advertising and
         certain common area maintenance costs. These additional rents and
     tenant reimbursements are accounted for on the accrual basis.

o Credit card operations                                
----------------------                              

 Revenues derived from credit card transactions consist of
           commissions and financing income. Commissions are recognized at the
       time the merchants' transactions are processed, while financing
income is recognized when earned.                       

o Hotel operations                                      
----------------                                    

     The Company recognizes revenues from its rooms, catering, and
          restaurant facilities as earned on the close of business each day.

o International operations                              
------------------------                            

            As of June 30, 2001, the Company held a 49.27% ownership interest in
    Brazil Realty, a company operating in Brazil, which business
       primarily comprised the same type of operations related to real
      estate conducted by the Company in Argentina. See Note 2.d.ii.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTA 4:  SEGMENT INFORMATION                                                    

        The Company has determined that its reportable segments are those that
       are based on the Company's method of internal reporting. Accordingly,
         the Company has six reportable segments. These segments are Development
      and sales of properties, Office and other non-shopping center rental
   properties, Shopping centers, Hotel operations, International and
   Others. As discussed in Note 2.a., the consolidated statements of
  income were prepared on a proportionate consolidation basis. The
         Company uses the "proportionate-consolidation method" of accounting for
  its investments in which the Company exercises control and other
   jointly controlled investments. This method has not been used for
        balance sheet and cash flows purposes. Accordingly, this note reflects
the results of operations of the Company's controlled and     
jointly-controlled subsidiaries on a proportionate basis.     

A general description of each segment follows:                

o     Development and sale of properties                      

          This segment includes the operating results of the Company's
               construction and ultimate sale of residential buildings business.

o     Office and other non-shopping center rental properties  

          This segment includes the operating results of the Company's
             lease and service revenues of office space and other non-retail
building properties from tenants.                 

o     Shopping centers                                        

          This segment includes the operating results of the Company's
         shopping centers principally comprised of lease and service
        revenues from tenants. This segment also includes revenues
               derived from credit card transactions that consist of commissions
and financing income.                             

o     Hotel operations                                        

          This segment includes the operating results of the Company's
           hotels principally comprised of room, catering and restaurant
revenues.                                         

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NOTE 4:  (continued)                                                            

o     International                                           

              This segment includes the results of operations of the Company's
            equity investments in: i) Brazil for all periods presented, as
       discussed in Note 2.d.ii), the Company sold its ownership
         interest in Brazil in February 2002, and ii) the results of
              operations of the equity investments in Venezuela for the period
             ended March 31, 2001, as discussed in Note 2.d.ii), the Company
        sold its ownership interest in Venezuela in December 2000.

o     Others                                                  

           This segment primarily includes revenues and associated costs
 generated from the sale of equity securities, other
              securities-related transactions and other non-core activities of
           the Company. For the years ended June 30, 2002 and 2001, this
          segment also includes the results in equity investees of the
        Company relating to Internet, telecommunications and other
technology-related activities of the Company.     

               The Company measures its reportable segments based on net income.
              Inter-segment transactions, if any, are accounted for at current
              market prices. The Company evaluates performance of its segments
              and allocates resources to them based on net income. The Company
is not dependent on any single customer.          

           The accounting policies of the segments are the same as those
              described in Note 2 to the financial statements and in Note 3 to
the consolidated financial statements.            

    The following information provides the operating results from each
business unit:                                                

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 4:  (continued)                                                            

As of June 31, 2002:                                          

                                                        [Enlarge/Download Table]

                                   ------------------------------------------------------------------------------------------------ 
                                                                                                          Financial and             
                                      Sales and    Office and                    Shopping                     other                 
                                    developments    others (a)   International    centers       Hotels     operations        Total  
                                   ------------------------------------------------------------------------------------------------ 
                                                                                                                                    
Income                                  45,202        34,250        24,820        77,585        29,462          --         211,319  
Costs                                  (37,402)      (10,692)      (14,061)      (38,426)      (20,774)         --        (121,355) 
Gross income                             7,800        23,558        10,759        39,159         8,688          --          89,964  
Selling expenses                        (3,672)         (477)       (4,576)      (22,289)       (3,318)         --         (34,332) 
Administrative expenses                 (8,971)       (4,959)       (3,773)      (11,219)       (8,721)         --         (37,643) 
Loss on purchasers rescissions                                                                                                      
  of sales contracts                        27          --            --            --            --            --              27  
Results from operations and                                                                                                         
  holding of real estate assets        (30,786)      (41,738)       31,514       (23,946)         --            --         (64,956) 
------------------------------------------------------------------------------------------------------------------------------------
OPERATING INCOME                       (35,602)      (23,616)       33,924       (18,295)       (3,351)         --         (46,940) 
------------------------------------------------------------------------------------------------------------------------------------
Net financial results                  (18,532)      (14,831)       (3,597)        8,855       (15,504)     (388,611)     (432,220) 
Net loss in related companies             --            --             404        (3,911)         --           1,540        (1,967) 
Other income and expenses, net            --            --              47        (4,744)          167        (3,981)       (8,511) 
(Loss) income before taxes             (54,134)      (38,447)       30.778       (18,095)      (18,688)     (391,052)     (489,638) 
Income tax and asset tax                  (569)       (3,341)       (4,533)       (1,333)          (58)         (147)       (9,981) 
Income for the year                    (54,703)      (41,788)       26,245       (19,428)      (18,746)     (391,199)     (499,619) 
------------------------------------------------------------------------------------------------------------------------------------
Depreciation and amortization (b)       (5,889)        7,663           219        30,403         4,815          --          37,211  
------------------------------------------------------------------------------------------------------------------------------------
Operating assets                       317,384       245,810          --         269,351       102,848          --         935,393  
Non operating assets                    36,644        27,581        26,129        30,223        11,540        77,205       209,322  
Total Assets                           354,028       273,391        26,129       299,574       114,388        77,205     1,144,715  

(a)      Includes offices, commercial and residential premises.                 
(b)      Included in operating income/loss.                                     

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NOTE 4:   (continued)                                                           

As of June 30, 2001                                         

                                                        [Enlarge/Download Table]

                                   -------------------------------------------------------------------------------------------------
                                                                                                           Financial                
                                    Sales and      Office and                  Shopping                    and other                
                                   developments    others (a)   International   centers         Hotels     operations      Total    
                                   -------------------------------------------------------------------------------------------------
                                                                                                                                    
Income                                 89,772        45,591        69,132        94,475        40,873          --         339,843   
Costs                                 (68,164)       (8,914)      (31,041)      (36,829)      (27,076)         --        (172,024)  
Gross income                           21,608        36,677        38,091        57,646        13,797          --         167,819   
Selling expenses                       (8,500)         (468)       (8,678)      (11,364)       (4,738)         --         (33,748)  
Administrative expenses               (13,429)       (6,279)       (7,169)      (14,049)       (9,814)         --         (50,740)  
Loss on purchasers rescissions                                                                                                      
  of sales contracts                      (14)         --            --            --            --            --             (14)  
Results from  operations and                                                                                                        
  holding of real estate assets        (3,793)       (1,878)         (634)         --            --            --          (6,305)  
------------------------------------------------------------------------------------------------------------------------------------
OPERATING INCOME                       (4,128)       28,052        21,610        34,233          (755)         --          77,012   
------------------------------------------------------------------------------------------------------------------------------------
Net financial results                 (24,981)      (19,945)      (14,347)      (28,113)       (8,452)      (14,464)     (110,302)  
Net loss in related companies             (22)         --          (1,299)       (1,420)         --          (7,582)      (10,323)  
Other income and expenses, net           --            --             (37)         (178)          237        (5,646)       (5,624)  
Income before taxes                   (29,131)        8,107         5,927         2,522        (8,970)      (27,692)      (49,237)  
Income tax and asset tax                   20        (2,404)       (1,933)         (786)           40          --          (5,063)  
(Loss) income ordinary of the year    (29,111)        5,703         3,994         1,736        (8,930)      (27,692)      (54,300)  
Extraordinary item                       --            --            --            --          (5,653)         --          (5,653)  
Income for the year                   (29,111)        5,703         3,994         1,736       (14,583)      (27,692)      (59,953)  
------------------------------------------------------------------------------------------------------------------------------------
Depreciation and amortization (b)         659         7,480           276        33,263         5,663          --          47,341   
------------------------------------------------------------------------------------------------------------------------------------
Operating assets                      392,952       316,034       133,933       307,481       110,463          --       1,260,863   
Non operating assets                   26,467        18,987         8,046        18,474         6,637       155,076       233,687   
Total Assets                          419,419       335,021       141,979       325,955       117,100       155,076     1,494,549   

(a)      Includes offices, commercial and residential premises.                 
(b)      Included in operating income/loss.                                     

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 5:  OTHER RECEIVABLES                                                      

The breakdown for this item is as follows:                    

                                                        [Enlarge/Download Table]

                                                  June 30,               June 30,       
                                                    2002                   2001         
                                         -----------------------------------------------
                                                          Non-                  Non-    
                                            Current     Current     Current    Current  
                                         -----------------------------------------------
                                                                                        
Asset tax and prepayments                       2,319      14,617      4,634     29,584 
Value Added Tax (VAT)                             466       1,224      6,457      2,555 
C.N. Hacoaj Project                               593           -      1,363          - 
Related parties                                   261      73,309        792      2,551 
Services to be billed                               -           -        364          - 
Personnel loans and prepayments                 2,654           -      2,107          - 
Notes receivable                                  301           -        589          - 
Prepaid expenses                               26,129           -          -          - 
Debtors under legal proceedings                     -           -      2,815          - 
Sundry debtors                                  2,418         433          -          - 
Operation pending settlement                      315           -     13,459          - 
Income tax prepayments and withholdings           333           -        886          - 
Country club debtors                              440           -      1,495          - 
Tax on debits and credits                           2           -         70          - 
Trust accounts receivable                       2,312           -          -          - 
Allowance for doubful accounts                      -           -      (342)          - 
Other                                               4          38      2,238         74 
                                         ===============================================
                                               38,547      89,621     36,927     34,764 
                                         ===============================================

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NOTE 6:  INVENTORY                                                              

The breakdown for this item is as follows:                    

                                                                [Download Table]

                                     June 30, 2002           
                         ------------------------------------
                                                  Non-       
                               Current           Current     
                         ------------------------------------
                                                             
Constitucion 1111                   3,767                -   
Dique IV                                -            5,483   
Dock 13                                48                -   
Dorrego 1916                            -               12   
Minetti "D"                             -              194   
Madero 1020                         4,730                -   
Caballito plots of land                 -           12,120   
Padilla 902                             -              219   
Pilar                                   -            3,032   
Puerto Madero Dock 5                    -              407   
Puerto Madero Dock 6                    -              113   
Rivadavia 2768                          -              137   
Sarmiento 517                           -              589   
Torres Jardin                         356              261   
V.Celina                                -               48   
Abril/Baldovinos                    8,344           11,298   
Alto Palermo Park                   4,555                -   
Alto Palermo Plaza                  2,087                -   
Benavidez                               -           12,645   
Other                                 243                -   
                         ====================================
                                   24,130           46,558   
                         ====================================

                                     June 30, 2001           
                         ------------------------------------
                                                  Non-       
                               Current           Current     
                         ------------------------------------
Constitucion 1111                   2,330                -   
Dique IV                                -            5,475   
Dock 13                                51                6   
Dorrego 1916                            -                -   
Minetti "D"                           491              156   
Figueroa Alcorta                      430                -   
Madero 1020                             -                -   
Caballito plots of land                 -           17,709   
Padilla 902                             -              321   
Pilar                                   -            3,032   
Puerto Madero Dock 5                    -                -   
Puerto Madero Dock 6                    -                -   
Sarmiento 517                         428               84   
Torres Jardin                       1,759              450   
V. Celina                              61                2   
Abril/Baldovinos                   11,872           18,838   
Alto Palermo Park                   5,452            8,666   
Alto Palermo Plaza                  1,289                -   
Benavidez                               -           12,645   
Other properties                      184               15   
Other                                 436                -   
                         ====================================
                                   24,783           67,399   
                         ====================================

The book value of inventories at June 30, 2002 includes the provision for       
impairment mentioned in Note 11 to the consolidated financial statements.       

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 7:  INVESTMENTS                                                            

The breakdown for this item is as follows:                    

                                                                [Download Table]

                                                   June 30,          June 30,      
                                                     2002               2001       
                                               ------------------------------------
                                                                                   
CURRENT                                                                            
-------                                                                            
Bocon Pro 1                                                    -           12,817  
Telecom Argentina                                              -           17,351  
Banco Hipotecario S.A.                                    11,522           21,051  
Perez Companc                                                                 788  
Time deposits and money markets                              422           22,741  
Mutual funds                                              24,852           13,545  
Other investments                                              -            1,414  
                                               ------------------------------------
                                                          36,796           89,707  
                                               ------------------------------------
NON-CURRENT                                                                        
-----------                                                                        
Alto Palermo S.A.                                        307,246          318,465  
Brazil Realty                                                  -          133,800  
Llao - Llao Resorts S.A.                                   9,745            5,104  
Alto Invest S.A.                                             174                -  
Banco de Credito y Securitizacion S.A.                     6,236            9,781  
Latin American Econetworks N.V.                                -            9,658  
IRSA Telecomunicaciones N.V.                               2,654            3,388  
Banco Hipotecario S.A.                                     6,500           32,015  
IRSA I Trust Exchangeable Certificate Class B              1,101                -  
IRSA I Trust Exchangeable Certificate Class C              1,767                -  
IRSA I Trust Exchangeable Certificate Class D              6,173                -  
IRSA I Trust Exchangeable Certificate Class A                755                -  
Art work                                                      33               33  
Other investments                                              5                -  
                                               ------------------------------------
                                                         342,389          512,244  
                                               ------------------------------------

Undeveloped parcels of land:                                                       
    Torres Jardin IV                                       1,985            2,698  
    Puerto Retiro                                         41,170           41,530  
    Intercontinental Plaza                                 1,020                -  
    Santa Maria del Plata                                103,213          110,244  
    Pereiraola                                            19,439           19.349  
    Buenos Aires Trade and Finance Center S.A.             6,166            3,256  
    Buenos Aires Realty S.A.                               4,671            3,840  
    Argentine Realty S.A.                                  4,559            3,977  
    Other parcels of undeveloped land                      1,736            2,755  
                                               ------------------------------------
                                                         183,959          187,649  
                                               ------------------------------------
                                                         526,348          699,893  
                                               ====================================

The book value of land reserves at June 30, 2002 includes the                   
provision for impairment mentioned in Note 11 to the consolidated               
financial statements.                                                           

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NOTE 8:  FIXED ASSETS                                                           

The breakdown for this item is as follows:                    

                                                                [Download Table]

                                         June 30,          June 30,      
                                            2002             2001        
                                     ------------------------------------
                                                                         
HOTELS                                                                   
Hotel Intercontinental                         53,359            62,561  
Hotel Libertador                               37,464            39,746  
Hotel Piscis - Advances to purchase               518                 -  
                                     ------------------------------------
                                               91,341           102,307  
                                     ------------------------------------
OFFICE BUILDINGS                                                         
Avda. De Mayo 595                               3,738             5,663  
Avda. Madero 942                                4,147             5,201  
Edificios costeros (Dique II)                  21,197            24,106  
Laminar Plaza                                  25,343            29,133  
Libertador 498                                 33,744            48,163  
Libertador 602                                  2,248             2,854  
Madero 1020                                     9,025            18,460  
Maipu 1300                                     36,922            42,607  
Puerto Madero Dock 5                                -             2,149  
Reconquista 823                                15,807            19,293  
Rivadavia 2768                                      -               301  
Sarmiento 517                                     229               513  
Suipacha 652                                    9,021            13,026  
Alto Palermo Plaza                                754             3,746  
Intercontinental Plaza                         57,915            64,825  
Costeros Dique IV                              15,877             2,425  
                                     ------------------------------------
                                              235,967           282,465  
                                     ------------------------------------
COMMERCIAL REAL ESTATE                                                   
Alsina 934                                      1,347             1,371  
Constitucion 1111                                 372             5,459  
Rivadavia 2243                                      -             7,339  
Av. Santa Fe 1588                                   -             7,457  
Other                                               -                 -  
                                     ------------------------------------
                                                1,719            21,626  
                                     ------------------------------------
OTHER FIXED ASSETS                                                       
Alto Palermo Park                                 714             2,737  
Thames                                          3,652             4,384  
Other                                           5,401             5,856  
                                     ------------------------------------
                                                9,767            12,977  
                                     ====================================
                                              338,794           419,375  
                                     ====================================

The book value at June 30, 2002 includes the provision for                      
impairment mentioned in Note 11 to the consolidated financial                   
statements.                                                                     

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 9:  SHORT AND LONG TERM DEBT                                               

The breakdown for this item is as follows:                    

                                                        [Enlarge/Download Table]

                                                         June 30,                 June 30,          
                                                           2002                     2001            
                                                 ---------------------------------------------------
                                                                 Non-                     Non-      
                                                   Current     Current      Current      Current    
                                                 ---------------------------------------------------
                                                                                                    
Intercompany                                               -           -            -            -  
Bank debts (1)                                       350,317         142      213,138       26,012  
Accrued interest - bank loans (1)                      7,210           -        2,866            -  
Commercial paper - capital                                -            -       48,905            -  
Commercial paper -  interest                               -           -        (910)            -  
Negotiable obligations  2001 - principal amount      149,249           -       85,095            -  
Negotiable obligations  2001 - accrued interest          540           -        1,371            -  
Other                                                 57,423           -                            
                                                 ===================================================
                                                     564,739         142      350,465       26,012  
                                                 ===================================================

      The detail of issue of negotiable obligations and financial loans is
mentioned in Note 6 to the individual financial statements.   

         (1) Includes $ 42,778 current corresponding to a loan secured with real
             property of Hoteles Argentinos S.A. See Note 15 to the consolidated
financial statements.                                 

NOTE 10: OTHER LIABILITIES                                                      

The breakdown for this item is as follows:                    

                                                        [Enlarge/Download Table]

                                                     June 30,                    June 30,           
                                                       2002                         2001            
                                          ----------------------------------------------------------
                                                               Non-                       Non-      
                                              Current        Current       Current      Current     
                                          ----------------------------------------------------------
                                                                                                    
Seller financing                                      833           725        1,626         2,836  
Dividends payable                                   6,567             -            -             -  
Intercompany                                           59           503            -             -  
Lessee deposits                                       968           837        1,240         3,506  
Pending settlements for sales of plots                957             -        2,306             -  
Provision for discounts                                33             -           65             -  
Accruals                                              107             -            -             -  
Fees payable                                            5             -          188             -  
Provision for lawsuits and contingencies              440           357          133           207  
Prepaid expenses                                      490             -          782             -  
Other receivables                                     107             -            -             -  
Collections on behalf of third parties                 50             -          188             -  
Other provisions                                      595             -        1,958           370  
Operation pending settlement                          903             -          671             -  
Directors' deposits                                     -             8            -            16  
Other                                               1,537           449          949           816  
                                          ==========================================================
                                                   13,544         2,879       10,106         7,751  
                                          ==========================================================

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 11: RESULTS FROM OPERATIONS AND HOLDINGS OF REAL ESTATE ASSETS             

The breakdown for this item is as follows:                    

                                                        [Enlarge/Download Table]

                                                                          June 30,         June 30,    
                                                                            2002             2001      
                                                                    -----------------------------------
                                                                                                       
Results from transactions related to shares of real estate companies       31,854             (634)    
Loss from holding of real estate assets  (2)                              (96,810)          (5,671)    
                                                                    ===================================
                                                                 (1)      (64,956)          (6,305)    
                                                                    ===================================

      (1)   This item includes losses from the quotation of shares in real
         estate companies, premiums on issuance of shares earned and
losses from the impairment of real estate assets. 

 (2)   Includes losses due to impairment of assets amounting to:

       -    $ 60,372 recorded by the Company at June 30, 2002 as
           mentioned in Notes 2.t. to the individual financial
statements.                             

             -    $ 25,899 recorded by the related company Alto Palermo S.A.
                    as a consequence of the recording of certain inventories and
               certain fixed assets at their recoverable value (mainly
         those identified as Alto Avellaneda, Alto Noa and
Caballito); and                         

             -    $ 10,438 recorded by the subsidiaries Palermo Invest S.A.,
Baldovinos S.A. and others.             

NOTE 12: FINANCIAL RESULTS, NET                                                 

The breakdown for this item is as follows:                    

                                                        [Enlarge/Download Table]

                                                        June 30,        June 30,     
                                                           2002           2001       
                                                     --------------------------------
                                                                                     
FINANCIAL RESULTS GENERATED BY ASSETS:                                               
Interest income                                               9,656            8,141 
(Loss)/Gain on financial operations                        (117,386)          (4,014)
Exchange loss                                                50,327          (18,901)
Gain on exposure to inflation - foreign investments        (151,448)          19,988 
Discounts granted                                              (265)               - 
                                                     --------------------------------
                                                           (209,116)           5,214 
                                                     --------------------------------
FINANCIAL RESULTS GENERATED BY LIABILITIES:                                          
Loss on exposure to inflation - foreign investments          98,397           (7,610)
Exchange loss                                              (305,415)          (6,686)
Discounts                                                         9             (546)
Financial expenses                                          (16,095)        (100,674)
                                                     --------------------------------
                                                           (223,104)        (115,516)
                                                     --------------------------------
FINANCIAL RESULTS, NET                                     (432,220)        (110,302)
                                                     ================================

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 13: OTHER INCOME AND EXPENSES; NET                                         

                                                                [Download Table]

                                              June 30,        June 30,     
                                                 2002           2001       
                                           --------------------------------
                                                                           
OTHER INCOME:                                                              
(Loss) gain on early redemption of debt             (174)          1,166   
(Loss) gain from the sale of fixed assets              -             166   
Other                                              1,519           2,144   
                                           --------------------------------
                                                   1,345           3,476   
                                           --------------------------------

OTHER EXPENSES:                                                            
Unrecoverable VAT                                 (1,344)         (3,288)  
Donations                                           (263)         (1,997)  
Contingencies for lawsuits                        (4,349)           (851)  
Debit and credit tax                              (1,783)              -   
Other                                             (2,117)         (2,964)  
                                           --------------------------------
                                                  (9,856)         (9,100)  
                                           --------------------------------
FINANCIAL RESULTS, NET                            (8,511)         (5,624)  
                                           ================================

NOTE 14: STATEMENTS OF INCOME                                                   

       As discussed in Note 2.a., the consolidated statements of income were
        prepared on a proportionate consolidation basis. As from July 1, 1996,
         the Company used the "proportionate-consolidation method" of accounting
      for its investments in which the Company exercises control and other
   jointly controlled investments. This method has not been used for
   balance sheet and cash flows purposes. The Company calculates the
         proportionate-consolidation method by applying its percentage ownership
      interest to the historical financial statements of its equity method
investments.                                                  

         The statements of income have been prepared following the guidelines of
Technical Resolution No. 4 of the F.A.C.P.C.E.:               

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 14: (continued)                                                            

                                                        [Enlarge/Download Table]

==============================================================================================
                                                                 June 30,        June 30,     
                                                                   2002            2001       
                                                             ---------------------------------
                                                                                              
Mortgages, leases and services                                       123,462         195,657  
Cost of sales, leases and services                                   (74,836)       (111,378) 
                                                             ---------------------------------
GROSS INCOME                                                          48,626          84,279  
                                                             ---------------------------------
Selling expenses                                                      (7,978)        (15,546) 
Administrative Expenses                                              (28,528)        (35,593) 
                                                             ---------------------------------
SUBTOTAL                                                             (36,506)        (51,139) 
                                                             ---------------------------------
Loss from operations and holding of real estate assets               (41,684)         (6,342) 
                                                             ---------------------------------
OPERATING INCOME                                                     (29,564)         26,798  
                                                             ---------------------------------
Financial results, net                                              (445,821)        (83,358) 
Equity in earnings of affiliated companies                           (17,797)          6,471  
Other income and (expenses), net                                      (4,322)         (5,266) 
                                                             ---------------------------------
SUBTOTAL                                                            (497,504)        (55,355) 
                                                             ---------------------------------
Minority interest                                                      5,118          (1,459) 
Income tax and asset tax                                              (7,233)         (3,139) 
                                                             ---------------------------------
LOSS FOR THE YEAR                                                   (499,619)        (59,953) 
==============================================================================================

NOTE 15: RESTRICTED ASSETS                                                      

Puerto Retiro S.A.: extension of the bankruptcy               
-----------------------------------------------               

        On April 18, 2000, Puerto Retiro S.A. was notified of a filing made by
         the National Government, through the Ministry of Defense, to extend the
     petition in bankruptcy of Inversora Darsena Norte S.A. (Indarsa) to
       Puerto Retiro S.A. Concurrently with the complaint, at the request of
  plaintiff, the bankruptcy court granted an order restraining the
    ability of Puerto Retiro to sell or dispose in any manner the real
estate property purchased from Tandanor S.A. ("Tandanor").    

        Indarsa had purchased 90% of the capital stock of Tandanor, a formerly
 state owned company privatized in 1991, engaged in the shipyard
industry.                                                     

 In June 1993, Tandanor sold the plot of land near Puerto Madero
denominated "Planta 1" to Puerto Retiro S.A.                  

      Indarsa did not comply with the payment of the outstanding price for
      the purchase of the stock of Tandanor, and therefore the Ministry of
      Defense requested the bankruptcy of Indarsa. Since the only asset of
        Indarsa were the shareholdings in Tandanor, the Ministry of Defense is
     pursuing to extend the bankruptcy to other companies or individuals
which, according to its view, acted as an economic group, and 
       therefore, requested the extension of the bankruptcy to Puerto Retiro
    which acquired Planta 1 from Tandanor. The lawsuit is at its first
stages. Puerto Retiro S.A. answered the claim and appealed the
        preventive measures ordered. This appeal was overruled on December 14,
2000.                                                         

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 15: (continued)                                                            

  Puerto Retiro S.A. believes, pursuant to the advice of its legal
       advisors, that the plaintiff's claim shall be rejected by the courts.

Hoteles Argentinos S.A.: mortgage loan                        
--------------------------------------                        

         The Extraordinary Shareholders' Meeting of Hoteles Argentinos S.A. held
         on January 5, 2001, approved taking a long-term mortgage loan from Bank
      Boston N.A. Buenos Aires for a total of US$ 12,000,000 to be used to
        refinance existing debts. The term of the loan was agreed at 60 months
       payable in 19 equal and quarterly installments of US$ 300,000 and one
         final payment of US$ 6,300,000. The agreement was signed on January 26,
2001.                                                         

  Interest is paid quarterly in arrears at an annual interest rate
      equivalent to LIBOR for nine-month loans plus the applicable mark-up
         per the contract, which consists in a variable interest rate applicable
       during the interest bearing periods, which ranges from 6.56% to 8.46%
per year.                                                     

    The guarantee granted was a senior mortgage on a Company property,
which houses the Hotel Sheraton Libertador Buenos Aires.      

        At the date of issue of these financial statements, as a result of the
      current economic situation, the lack of credit and the crisis of the
         Argentine financial system, principal installments falling due on April
        29 and July 29, 2002 and the interest installment amounting to US$ 127
       thousand falling due on July 29, 2002 were not paid. Although Hoteles
         Argentinos' Management is renegotiating the debt with its creditors, as
       failure to pay the installments when due entitles the bank to require
      acceleration of principal and interest maturities, the loan has been
classified and is shown under current financial loans in these
financial statements.                                         

NOTE 16: REDUCTION OF CAPITAL STOCK OF IRSA INTERNATIONAL LIMITED AND RITELCO   
S.A.                                                                            

      On December 22, 2000, the shareholders of IRSA International Limited
        decided to redeem shares and retained earnings in that company for US$
       59,260. On the same date, the shareholders of Ritelco S.A. decided to
        redeem shares for US$ 58,727. These reductions are pending of approval
from the respective control authorities.                      

  On March 7, 2001, the shareholders of IRSA International Limited
decided to redeem shares for US$ 4,370. On the same date, the 
      shareholders of Ritelco S.A. decided to redeem shares for US$ 4,560.
    Both decisions are pending of approval from the respective control
authorities.                                                  

      During the period ended September 30, 2001, the shareholders of IRSA
      International Limited decided to redeem shares and retained earnings
         for US$ 12,464. The decision is pending of approval from the respective
control authorities.                                          

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NOTE 16: (continued)                                                            

 On June 30, 2002 the shareholders of IRSA International Limited
       approved the liquidation of the Company, which is pending approval by
         the control authorities. On that date, the shareholders of Ritelco S.A.
 decided to make a reduction in capital stock and unappropriated
        retained earnings amounting to US$ 46,879 thousand. That reduction has
     not yet been submitted to the approval of the corresponding control
authorities.                                                  

NOTE 17: IRSA INTERNATIONAL LIMITED INVESTMENTS IN IRSA                         
TELECOMUNICACIONES N.V.                                       

        In the fourth quarter of the year ended June 30, 2000, the Company had
invested US$ 3.0 million, in the form of irrevocable capital  
      contributions, into two unrelated companies, namely, Red Alternativa
       S.A., a provider of satellite capacity to Internet service providers,
        and Alternativa Gratis S.A., an Internet service provider (referred to
herein as the "Companies"). At that date, the Companies were  
development stage companies with no significant operations.   

       Between July 2000 and August 2000, the Company, together with Dolphin
        Fund Plc, increased their respective investments in the abovementioned
   Companies, in exchange for shares of common stock. In a series of
         transactions, which occurred between August 2000 and December 2000, (i)
     the Company formed IRSA Telecomunicaciones N.V. ("ITNV"), a holding
       company organized under the laws of the Netherlands Antilles, for the
purposes of completing a reorganization of the Companies (the 
  "Reorganization") and (ii) the Company, Dolphin Fund Plc and the
  previous majority shareholder of the Companies contributed their
       respective ownership interests in the Companies into ITNV in exchange
for shares of common stock of ITNV                            

 In September and December 2000, the Company had made additional
        contributions to ITNV for US$ 3 million, generating an increase in its
participation in the capital stock at that date of 62%.       

       As a result of the Reorganization, the Companies are now wholly owned
        subsidiaries of ITNV. Following the Reorganization, the Company held a
49.36% interest in ITNV.                                      

On December 27, 2000, the shareholders of ITNV entered into an
         agreement with Quantum Industrial Partners LDC ("QIP") and SFM Domestic
       Investment LLC ("SFM" and together with QIP referred to herein as the
        "Investors") (the "Shareholders Agreement"), under which the Investors
         contributed US$ 4.0 million in cash in exchange for 1,751,453 shares of
    Series A mandatorily redeemable convertible preferred stock and an
option to purchase 2,627,179 additional shares of mandatorily 
      redeemable convertible preferred stock. Pursuant to the terms of the
      Shareholders Agreement, options were granted for a period up to five
         years and at an exercise price equal to the quotient of US$ 6.0 million
    by 2,627,179 preferred shares. On or after December 27, 2005, ITNV
  might be required, at the written request of holders of the then
outstanding Series A preferred stock to redeem such holders'  
        outstanding shares of series A preferred stock for cash at the greater
of (i) 200% of the original issue price multiplied by the     

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NOTE 17: (continued)                                                            

    number of preferred stock to be redeemed, and (ii) the fair market
    value of the common shares each holder of Series A preferred stock
      would have been entitled to receive if such holder had converted the
        number of Series A preferred stock to be redeemed into common stock at
       the redemption date; plus in the case of (i) and (ii), any accrued or
declared but unpaid dividends.                                

NOTE 18: SETTING UP OF A FINANCIAL TRUST FOR THE SECURITIZATION OF RECEIVABLES  
 OF IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA (IRSA),
INVERSORA BOLIVAR S.A. AND BALDOVINOS S.A.                    

    The Board of Directors of IRSA, in the meeting held on November 2,
2001, authorized the setting up of a financial trust for the  
      securitization of Company receivables. The trust program for issuing
    participation certificates, under the terms of Law No. 24.441, was
       approved by the National Securities Commission by means of Resolution
   No. 13.040, dated October 14, 1999, as regards the program and in
       particular as regards the Trust called IRSA I following a decision of
the Board of Directors dated December 14, 2001.               

         On December 17, 2001, IRSA, Inversora Bolivar S.A. and Baldovinos S.A.,
  parties of the first part (hereinafter the "Trustors") and Banco
     Sudameris Argentina S.A., party of the second part (hereinafter the
        "Trustee"), have agreed to set up the IRSA I Financial Trust under the
         Global Program for the Issuance of FIDENS Trust Values, pursuant to the
contract entered into on November 2, 2001.                    

         Under the above program, the trustors have sold their personal and real
      estate credits, secured with mortgages or arising from bills of sale
         with the possession of the related properties, for the total amount US$
         26,585,774 to the Trustee, in exchange for cash and the issuance by the
         Trustee of Participation Certificates for the same nominal value and in
accordance with the following classes:                        

        o     Class A Participation Certificates ("CPA"): Nominal value of US$
             13,300,000, with a 15% fixed annual nominal yield, with monthly
      Service payments due on the 15th of each month or on the
immediately following working day.                

        o     Class B Participation Certificates ("CPB"): Nominal value of US$
        1,000,000, with a 15.50% fixed annual, nominal yield, with
              monthly Service payments due on the 15th of each month or on the
             immediately following working day. These certificates grant the
        right to collect the following Services: (a) a fixed yield
      calculated on the Class' principal balance, with monthly
             capitalization, payable monthly as from the total settlement of
              the CPAs, and (b) an amortization equivalent to the sums paid as
              from the Last Service Payment Date on which the total settlement
              of the CPA Certificates may have taken place, net of their fixed
yield.                                            

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA
AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 18: (continued)                                                            

        o     Class C Participation Certificates ("CPC"): Nominal value of US$
            1,600,000, with a 16% fixed annual nominal yield, with monthly
      Service payments due on the 15th of each month or on the
             immediately following working day. These certificates grant the
        right to collect the following Services: (a) a fixed yield
      calculated on the Class' principal balance, with monthly
             capitalization, payable monthly as from the total settlement of
              the CPBs, and (b) an amortization equivalent to the sums paid as
              from the Last Service Payment Date on which the total settlement
             of the CPBs may have taken place, net of their fixed yield. The
          fixed yield will accrue as from the Cut-Off Date and will be
capitalized on a monthly basis.                   

        o     Class D Participation Certificates ("CPD"): Nominal Value of US$
           10,685,774. These grant the right to collect monthly the sums
              arising from the Cash Flow, net of the contributions made to the
               Expense Fund, once the remaining classes have been fully settled.

         The period for placing the Participation Certificates was from December
27, 2001 to January 15, 2002.                                 

    Pursuant to Decree No. 214/02, assets and debts in U.S. dollars or
  other foreign currencies in the Argentine financial system as of
         January 6, 2002, were converted to pesos at the rate of exchange of Ps.
         1 per US$ 1 or its equivalent in another currency and was adjusted by a
reference stabilization index (CER).                          

        At June 30, 2002, the Exchangeable Class A , B , C and D Participation
        Certificates amounted to thousand $ 8,162 in IRSA, thousand $ 1,300 in
Inversora Bolivar S.A., and thousand $ 334 in Baldovinos S.A. 

NOTE 19: CAPITAL REDUCTION IN PALERMO INVEST S.A. AND INVERSORA BOLIVAR S.A.    

     On November 9, 2001, IRSA Inversiones y Representaciones S.A. ("the
   Company") and GSEM/AP Holdings L.P. ("GSEM") entered into a first
       amendment to the Shareholders' Agreement entered into on February 25,
         1998, which was followed by a second amendment dated November 27, which
established, among other issues, the following:               

  a)    The capital reduction of Palermo Invest S.A. by thousand $
37,169.                                           

         b)    The unanimous approval of Palermo Invest S.A.'s shareholders of a
              cash dividend for a total amount in pesos equivalent to thousand
              US$ 19,702, provided this amount does not exceed, on the payment
dates, the amount legally distributable.          

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 19: (continued)                                                            

c)    The assignment by the Company in favor of GSEM of rights
         proportional to the dividends mentioned in b) (called "IRSA
              Dividend Right"), in such a way that GSEM will have the right to
          collect all the dividends that may be approved (called "GSEM
   Dividend Right"), with the scope defined in point g).

      d)    The Company's obligation to pay a total amount of thousand US$
               13,135 to GSEM (called "GSEM Credit"), to be settled in two equal
              installments for a total amount of US$ 6,567 each, plus interest
               accrued at the time of payment, the first installment falling due
   on January 31, 2002 and the second on April 30, 2002.

       e)    The entering into a Share Trust Agreement pursuant to which the
               Company has assigned in trust, under the terms of Law No. 24,441,
             in favor of the Trustee (ABN AMRO BANK N.V.), all the shares it
         owns in Palermo Invest S.A. Under no circumstances, may the
               Trustee transfer, pledge or otherwise assign IRSA's shares either
         wholly or partially to any Person, and it must at all times
              exercise the voting rights granted by the shares as indicated by
             IRSA. Under the trust provisions, GSEM is not empowered, at any
            time, to request the trustee to extinguish the right to redeem
        IRSA's shares. Upon the Company's total fulfillment of its
             obligations to GSEM, the trustee must return the shares to IRSA
         under the terms and conditions of the trust agreed with the
Trustee.                                          

       f)    GSEM is empowered to collect all the distributions that Palermo
               Invest S.A. may resolve, provided the Company has not settled all
              the obligations generated in favor of GSEM, as provided in point
d) above.                                         

        g)    Finally, the Company and GSEM/AP Holdings L.P. acknowledge that:
             i) all the amounts received in cash by GSEM from Palermo Invest
             S.A. on account of IRSA Dividend Right, must be considered as a
             reduction in the amount owed by IRSA under the GSEM Credit, and
            ii) all the amounts received in cash by GSEM on account of the
           GSEM Credit will oblige GSEM to return to IRSA the equivalent
               portion of IRSA Dividend Right, but if IRSA pays the total amount
              plus all accrued interest and reasonable costs to GSEM, IRSA may
         then recover its rights regarding the IRSA Dividend Right .

    At the date of these financial statements: a) the first and second
  installment regarding the Company's payment obligation with GSEM
      mentioned in point d), which were due on January 31, 2002, and April
30, 2002, respectively are still outstanding.                 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 20: DERIVATIVE INSTRUMENTS                                                 

      The Company uses various financial derivatives, mainly term exchange
 purchase-sale contracts, to hedge its net investment in foreign
      operations and as a complement to reduce its global financial costs.
       The counterparties to these instruments generally are major financial
         institutions. The Company does not hold or issue derivative instruments
         for trading purposes. In entering into these contracts, the Company has
  assumed the risk that might arise from the possible inability of
       counterparties to meet the terms of their contracts. The Company does
not expect any losses as a result of counterparty defaults.   

       At June 30, 2002, there were no operations with financial instruments
in effect.                                                    

      At June 30, 2001, the Company had the following derivative activity:

(i) Foreign currency forward-exchange contracts               

   The Company uses foreign currency forward-exchange contracts as a
       supplement to reduce its overall financing costs. Premiums on foreign
        currency forward-exchange contracts are amortized over the life of the
respective contract.                                          

     At June 30, 2001, the Company had three term exchange purchase-sale
         contracts with financial entities to sell US$ 16.8 milliion falling due
      in August 2001 and, through its subsidiary Ritelco S.A., an exchange
       purchase-sale contract to sell US$ 10.0 million maturing in September
2001. The Company recorded net income of $ 0.4 million in its 
     consolidated financial statements during the year ended on June 30,
2001.                                                         

(ii) Interest rate swap                                       

      In order to minimize its financing costs and to manage interest rate
       exposure, the Company entered into an interest rate swap agreement to
       effectively convert a portion of its peso-denominated fixed-rate debt
  to peso-denominated floating rate debt. As of June 30, 2001, the
 Company had an interest rate swap agreement outstanding with an
       aggregate notional amount of US$ 15.0 million with maturities through
        August 2001. The interest rate payable was at a variable rate of 22.3%
 and interest rate receivable was at a fixed rate of 10.15%. Any
       differential to be paid or received was accrued and was recognized as
   an adjustment to interest expense in the statement of income. The
        related accrued receivable or payable was included as an adjustment to
interest payable. The fair value of the swap agreement was not
         recognized in the financial statements. The risk assumed by the Company
       with respect to the swap contract is limited to the cost of replacing
       that contract at current market rates. The Company considers that the
        cost would be increased in the event of an increase in interest rates.

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Name of the Company:           IRSA INVERSIONES Y                               
 REPRESENTACIONES SOCIEDAD ANONIMA

Corporate domicile:                                                             

   Bolivar 108 1(st) Floor - Federal Capital

Principal activity:                                                             

Real estate investment and development

 Financial Statements for the year
 ended as of June 30, 2002
compared with the same previous year
Stated in thousands of pesos
 Fiscal year No. 59 beginning July 1(st), 2001

DATE OF REGISTRATION WITH THE PUBLIC REGISTRY OF COMMERCE                       

Of the By-laws:                        June 25, 1943                            

Of last amendment:                     July 2, 1999                             

Registration number with the                                                    
Superintendence of Corporations:       4,337                                    

Duration of the Company:               Until April 5,  2043                     

Information related to subsidiary companies is shown in Schedule C.             

                                                        [Enlarge/Download Table]

==========================================================================================================================
                                              CAPITAL COMPOSITION (NOTE 11)                                               
--------------------------------------------------------------------------------------------------------------------------
                                                                                              In thousands of pesos       
--------------------------------------------------------------------------------------------------------------------------
                                                        Authorized for Public Offer of                                    
                     Type of stock                                  Shares                 Subscribed        Paid up      
--------------------------------------------------------------------------------------------------------------------------
                                                                                                                          
Common stock,1 vote each                                                    211,999,273          212,000          212,000 
Treasury stock                                                              (4,587,285)          (4,588)          (4,588) 
                                                        ------------------------------------------------------------------
                                                                            207,411,988          207,412          207,412 
==========================================================================================================================

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 BALANCE SHEETS AS OF JUNE 30, 2002 AND 2001

 In thousands of pesos

                                                        [Enlarge/Download Table]

============================================================================================
                                                               June 30,        June 30,     
                                                                  2002            2001      
                                                            (Notes 1 and 2) (Notes 1 and 2) 
                                                            --------------------------------
                                                                                            
ASSETS                                                                                      
------                                                                                      
CURRENT ASSETS                                                                              
--------------                                                                              
Cash and banks (Schedule G)                                           4,283           5,908 
Investments (Schedules C, D and G)                                    9,497          34,948 
Mortgages and leases receivables (Note 3 - Schedule G) G)             8,384          31,985 
Other receivables (Note 4 - Schedule G)                              52,476          13,216 
Inventory (Note 5)                                                    8,901           5,734 
                                                            --------------------------------
TOTAL CURRENT ASSETS                                                 83,541          91,791 
                                                            --------------------------------
NON-CURRENT ASSETS                                                                          
------------------                                                                          
Mortgages receivables (Note 3 - Schedule G)                           2,258          35,105 
Other receivables (Note 4 - Schedule G)                              85,373          25,381 
Inventory (Note 5)                                                   22,615          27,260 
Investments (Schedules C, D and G)                                  624,783         904,741 
Fixed assets (Schedule A)                                           181,810         238.675 
Intangible assets (Schedule B)                                        2,055           4,178 
                                                            --------------------------------
TOTAL NON-CURRENT ASSETS                                            918,894       1,235,340 
                                                            --------------------------------
TOTAL ASSETS                                                      1,002,435       1,327,131 
============================================================================================

                                                        [Enlarge/Download Table]

=========================================================================================
                                                            June 30,        June 30,     
                                                               2002            2001      
                                                         (Notes 1 and 2) (Notes 1 and 2) 
                                                         --------------------------------
                                                                                         
LIABILITIES                                                                              
-----------                                                                              
CURRENT LIABILITIES                                                                      
-------------------                                                                      
Trade accounts payable (Schedule G)                                6,350           3,020 
Notes payable (Schedule G)                                             -               - 
Customer advances (Schedule G)                                       186             884 
Short and long term debt (Note 6 - Schedule G)                   521,170         346,640 
Salaries and social security charges                                 343             346 
Taxes payable (Schedule G)                                         9,674           4,613 
Other liabilities (Note 7 - Schedule G)                            2,342           5,237 
                                                         --------------------------------
TOTAL CURRENT LIABILITIES                                        540,065         360,740 
                                                         --------------------------------
NON-CURRENT LIABILITIES                                                                  
-----------------------                                                                  
Trade accounts payable (Schedule G)                                    -             374 
Short and long term debt (Note 6 - Schedule G)                         -               - 
Customer advances (Schedule G)                                         -             360 
Taxes payable                                                          -               - 
Other liabilities (Note 7 - Schedule G)                            1,954           5,622 
                                                         --------------------------------
TOTAL NON-CURRENT LIABILITIES                                      1,954           6,356 
                                                         --------------------------------
TOTAL LIABILITIES                                                542,019         367,096 
                                                         --------------------------------
SHAREHOLDERS `EQUITY (As per relevant statement)                 460,416         960,035 
                                                         --------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                     1,002,435       1,327,131 
=========================================================================================

The accompanying notes and schedules are an integral part of these financial    
statements.                                                                     

                                                         Eduardo Sergio Elsztain
                                                         President

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

STATEMENTS OF INCOME
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001
 In thousands of pesos

                                                        [Enlarge/Download Table]

==========================================================================================================
                                                                             June 30,        June 30,     
                                                                                2002            2001      
                                                                          (Notes 1 and 2) (Notes 1 and 2) 
                                                                          --------------------------------
                                                                                                          
Mortgages, leases and services                                                    51,707          97,787  
Cost of sales, leases and services (Schedule F)                                  (33,695)        (54,490) 
                                                                          --------------------------------
GROSS INCOME                                                                      18,012          43,297  
                                                                          --------------------------------
Selling expenses (Schedule H)                                                     (2,137)         (4,380) 
Administrative expenses (Schedule H)                                             (13,242)        (19,681) 
                                                                          --------------------------------
SUBTOTAL                                                                         (15,379)        (24,061) 
                                                                          --------------------------------
Loss from operations and holding of real estate assets (Schedule E and                                    
Note 2.t)                                                                        (60,425)         (5,601) 
                                                                          --------------------------------
OPERATING INCOME                                                                (57,792)          13,635  
                                                                          --------------------------------
Financial results, net (Note 8)                                                 (364,333)        (53,641) 
Equity in earnings of controlled and affiliated companies (Nota 10 c.)           (72,222)        (15,669) 
Other income and expenses,net (Note 9)                                            (2,348)         (4,959) 
                                                                          --------------------------------
Loss before taxes                                                               (496,695)        (60,634) 
Income tax and asset tax (Note 2 .g and .h)                                      (2,924)             681  
                                                                          --------------------------------
LOSS FOR THE YEAR                                                               (499,619)        (59,953) 
==========================================================================================================

The accompanying notes and schedules are an integral part of these financial    
statements.                                                                     

                                                         Eduardo Sergio Elsztain
                                                         President

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001
 In thousands of pesos (Notes 1 and 2)

                                                        [Enlarge/Download Table]

---------------------------------------------------------------------------------------------------------------------------------
                                                                             Shareholders' contributions                         

---------------------------------------------------------------------------------------------------------------------------------
                                                                           Inflation     Inflation                               
                                                             Treasury     adjustment    adjustment                               
                                             Common Stock      stock       of common    of treasury   Additional                 
                   Items                       (Note 11)     (Note 11)       stock         stock     paid-in-capital   Total     
---------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                 
Balances as of beginning of the year              207,412         4,588       216,042         4,781       506,767       939,590  
Purchase of treasury stock                              -             -             -             -             -             -  
Net loss for the year                                   -             -             -             -             -             -  
                                             ------------------------------------------------------------------------------------
Balances as of 30.06.02                           207,412         4,588       216,042         4,781       506,767       939,590  
                                             ====================================================================================
Balances as of 30.06.01                           207,412         4,588       216,042         4,781       506,767       939,590  
=================================================================================================================================

====================================================================================================                             
                                             Reserved                                                                            
                                             Earnings                                                                            
                                          ---------------                                                                        
                                                            Retained     Total as of   Total as of                               
                   Items                   Legal reserve    earnings    June 30, 2002 June 30, 2001                              
----------------------------------------------------------------------------------------------------                             
                                                                                                                                 
Balances as of beginning of the year             17,305          3,140       960,035     1,100,419                               
Purchase of treasury stock                            -              -             -       (80,431)                              
Net loss for the year                                 -       (499,619)     (499,619)      (59,953)                              
                                           ---------------------------------------------------------                             
Balances as of 30.06.02                          17,305       (496,479)      460,416             -                               
                                           =========================================================                             
Balances as of 30.06.01                          17,305          3,140             -       960,035                               
====================================================================================================                             

The accompanying notes and schedules are an integral part of these financial    
statements.                                                                     

                                                         Eduardo Sergio Elsztain
                                                         President

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STATEMENTS OF CASH FLOWS (1)
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001
 In thousands of pesos

                                                        [Enlarge/Download Table]

============================================================================================================================
                                                                                              June 30,        June 30,      
                                                                                                2002             2001       
                                                                                          (Notes 1 and 2)  (Notes 1 and 2)  
                                                                                          ----------------------------------
                                                                                                                            
CASH FLOWS FROM OPERATING ACITIVITES:                                                                                       
    Loss for the year                                                                          (499,619)        (59,953)    
    ADJUSTMENTS TO RECONCILE NET LOSS TO CASH FLOW FROM OPERATING ACTIVITIES:                                               
    o  Equity in earnings of affiliated companies                                                45,744          14,672     
    o  Write-down of inventories                                                                 60,372           5,601     
    o  Allowances and provisions                                                                    667             364     
    o  Amortization and depreciation                                                             11,011          11,900     
    o  Financial results                                                                        294,155           3,416     
    o  Income tax                                                                                 2,924            (681)    
    CHANGES IN ASSETS AND LIABILITIES:                                                                                      
    o  Decrease (Increase) in current investments                                                10,105         (33,070)    
    o  Decrease  in non-current investments                                                         569               -     
    o  Decrease in mortgages and leases receivables, net                                         22,934          10,847     
    o  Increase in other receivables                                                            (32,707)         15,221     
    o  Decrease in inventory                                                                     19,394          32,719     
    o  Decrease in intangible assets                                                                241           1,508     
    o  Increase (Decrease) in taxes payable, salaries and social security and                                               
         customer advances                                                                        6,575         (10,049)    
    o  Increase in accounts and notes payable                                                     4,780             919     
    o  Increase in accrued interest                                                              55,102          54,322     
    o  Cash dividends received                                                                    2,502           5,503     
    o  Increase (Decrease) in other liabilities                                                  22,963          (2,128)    
                                                                                          ----------------------------------
    NET CASH (USED IN) PROVIDED BY  OPERATING ACTIVITIES                                         27,712          51,111     
                                                                                          ----------------------------------
    CASH FLOWS FROM INVESTING ACTIVITIES:                                                                                   
    o  Net proceeds from the sale of interests in joint controlled companies                     79,941         133,176     
    o  Payment for acquisition of subsidiary companies and equity investees                      (6,515)         (8,949)    
    o  Payment for acquisition of undeveloped parcels of land                                      (557)           (775)    
    o  Purchase and improvements of fixed assets                                                (19,214)         (4,237)    
    o  Cash acquired (from Home Financing,  Santa Maria del Plata and Sociedad del Dique                                    
       mergers and liquidation of IRSA International Ltd.)                                          385              78     
    o  Loans granted to related parties                                                         (85,159)              -     
                                                                                          ----------------------------------
       NET CASH PROVIDED BY INVESTING ACTIVITIES                                                (31,119)        119,293     
                                                                                          ----------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:                                                                                       
    o  Purchase of treasury stock                                                                     -         (80,431)    
    o  Intercompany loans                                                                        60,676               -     
    o  Proceeds from loans                                                                      105,207         322,501     
    o  Payment of loans                                                                        (160,675)       (391,152)    
    o  Increase in intangible assets                                                             (3,033)         (4,799)    
    o  Payment of seller financing                                                               (1,766)        (15,225)    
                                                                                          ----------------------------------
    NET CASH USED IN FINANCING ACTIVITIES                                                           409        (169,106)    
                                                                                          ----------------------------------
    NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS                                         (2,998)          1,298     
    CASH AND CASH EQUIVALENTS AS OF BEGINNING OF YEAR                                             7,477           6,168     
                                                                                          ----------------------------------
    CASH AND CASH EQUIVALENTS AS OF END OF YEAR                                                   4,479           7,466     
============================================================================================================================

(1) Includes cash, banks and investments with a realization term not exceeding  
three months.                                                                   

The accompanying notes and schedules are an integral part of these financial    
statements.                                                                     

                                                         Eduardo Sergio Elsztain
                                                         President

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STATEMENTS OF CASH FLOWS (CONTINUED)
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001
 In thousands of pesos

                                                        [Enlarge/Download Table]

                                                                                             June 30,          June 30,    
                                                                                               2002             2001       
                                                                                         (Notes 1 and 2)   (Notes 1 and 2) 
                                                                                         ----------------------------------
                                                                                                                           
SUPPLEMENTAL CASH FLOW INFORMATION                                                                                         
NON-CASH ACTIVITIES:                                                                                                       
o        Increase in inventory through a decrease in fixed assets                               32,399         19,537      
o        Increase in intangible assets through a decrease in inventory                               -            595      
o        Assets acquired from mergers                                                              388         55,625      
o        Increase in fixed assets throgh a decrease in inventories                                   -             10      
o        Decrease in mortgages receivables through the trust                                    16,688              -      
o        Increase in non current investments through a decrease in mortgage receivables         16,190              -      
o        Increase in other receivables through a decrease in receivables                         2,023              -      
o        Increase in investments through a decrease in other current receivables                     -          1,174      
o        Decrease in short and long term debt through a decrease in current investments          5,620              -      
o        Assets acquired from liquidation                                                      108,754              -      
o        Decrease in other liabilities through a decrease in other receivables                  78,495              -      

                                                         Eduardo Sergio Elsztain
                                                         President

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 NOTES TO THE FINANCIAL STATEMENTS
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001
 In thousands of pesos

NOTE 1:  BASIS FOR THE PRESENTATION                                             

a) Disclosure criteria                                        

       In compliance with the provisions of Resolution No. 368/01 and 372/01
        of the Argentine Securities Commission, these financial statements are
       stated in thousands of Argentine pesos and have been prepared in line
   with the valuation and disclosure criteria contained in Technical
Resolutions No. 4, 5, 6, 8, 9, 10, 12 and 13 of the Argentine 
Federation of Professional Councils of Economic Sciences (the 
  "FACPCE"), and according to the provisions of the aforementioned
Resolutions.                                                  

       These financial statements include the effect of the Company's merger
        with a) Home Financing S.A. effective July 1, 2001 and b) Sociedad del
   Dique S.A. and Santa Maria del Plata S.A. effective July 1, 2000.

   The present financial statements must be readen condiderating the
 circumstances mentioned in note 1 to the consolidated financial
statements.                                                   

b) Recognition of the effects of inflation                    

   The financial statements have been prepared in constant currency,
         reflecting the overall effects of inflation through August 31, 1995. As
      from that date, in accordance with professional accounting standards
     and the requirements of the control authorities, restatement of the
        financial statements was discontinued until December 31, 2001. As from
  January 1, 2002, in accordance with Resolution No. 3/2002 of the
     Professional Council in Economic Sciences of the Autonomous City of
Buenos Aires and Resolution No. 415 of the National Securities
  Commission, the effects of inflation are being recognized in the
       financial statements. To this end, the restatement method established
         by Technical Pronouncement No. 6 of the F.A.C.P.C.E. has been followed.

       As a consequence of the above, the Company's financial statements are
         presented in constant currency of June 30, 2002, having considered that
      the accounting measurements restated by the change in the purchasing
       power of the currency until August 31, 1995 and those arising between
      that date and December 31, 2001 are stated in currency of the latter
date.                                                         

         The above restatement was made applying the coefficients prepared based
on the domestic wholesale price index.                        

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 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

 The Company used a conversion factor to restate the comparative
       financial statements in constant Argentine pesos of June 30, 2002 for
comparative purposes.                                         

NOTE 2:  SIGNIFICANT ACCOUNTING POLICIES                                        

 The following is a summary of the principal accounting policies
         followed by the Company in the preparation of the financial statements,
         which have been applied consistently with respect to the previous year.

a.    Investments                                             
-----------                                       

a.1.       Current investments                                
-------------------                     

                   Current investments include time deposits, which are valued
                   at their cost plus accrued interest and mutual funds, which
are carried at market value.            

                 Time deposits have original maturities of three months or
              less. Unrealized gains and losses on time deposits and
                   mutual funds are included in financial results, net, in the
statements of income.                   

              Current investments also include equity securities and
                   government bonds. Unrealized gains and losses on government
                  bonds and equity securities are also included in financial
  results, net, in the statements of income.

                   Generally, these investments represent securities traded on
                    a National Securities Exchange, which are valued at the last
                   reported sales price on the last business day of the period
net of estimated selling expenses.      

a.2.  Non-current investments                                 
-----------------------                           

a.2.1.     Equity investments                                 

                 Equity investments in controlled and affiliated companies
           have been accounted for under the equity method, in
                    accordance with the provisions of Technical Resolution No. 5
of the F.A.C.P.C.E.                     

                   Equity investments in less than 20% of the capital stock in
                    companies in which the Company does not exercise significant
                    influence are generally carried at market value, recognizing
                  realized gains and losses in earnings, and if these do not
exist, at their acquisition cost.       

                   The value paid for the purchase of shares in controlled and
                    affiliated companies over or under their equity value at the
                  date of acquisition was recognized as positive or negative
    goodwill, which is amortized over ten years.

                   The Company presents consolidated financial statements with
      its subsidiaries as complementary information.

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NOTE 2:  (Continued)                                                            

a.2.2.     Participation certificates                         

                   The certificates of participation in IRSA I financial trust
               have been valued at their acquisition cost plus accrued
                   interest in the case of classes A, B and C, and at the cost
                 resulting from apportioning the participation certificate
           holding to the trust assets in the case of class D.

a.3.  Plots of land                                           
-------------                                     

          The Company acquires undeveloped land in order to provide an
             adequate and well-located supply for its residential and office
              building operations. The Company's strategy for land acquisition
             and development is dictated by specific market conditions where
the Company conducts its operations.              

               Land held for development and sale and improvements are stated at
               cost adjusted for inflation at the end of the year, as defined in
               Note 1.b), or estimated net realizable value, whichever is lower.
            Land and land improvements are transferred to inventories when
construction commences.                           

            As mentioned in Note 2.m., at June 30, 2002 the Company set up
             provisions for impairment of certain plots (identified as Santa
Maria del Plata and Torres Jardin IV).            

           The provision amounted to $ 8,301 thousand and is shown under
               "Result from operations and holding of real estate assets" in the
    Statement of Income at June 30, 2002. (See Schedule E)

              The accounting value of plots of land, net of provisions set up,
does not exceed estimated recoverable value.      

b.    Inventory                                               
---------                                         

               A property is classified as available for sale upon determination
               by the Board of Directors that the property is to be marketed for
         sale in the normal course of business over the next several
years.                                            

              Residential, office and other non-retail properties completed or
              under construction are stated at cost, adjusted for inflation at
            the end of the year, as defined in Note 1.b), or estimated net
               realizable value, whichever is lower. Costs include land and land
            improvements, direct construction costs, construction overhead
            costs, interest on indebtedness and real estate taxes. Selling
              and advertising costs are deferred and charged to expense in the
              year in which the related revenue is earned, as determined under
           the percentage-of-completion method. Total contract costs are
            charged to expense in the year in which the related revenue is
              earned, as determined under the percentage-of-completion method.
               No interest costs were capitalized during the year ended June 30,
2002 and 2001.                                    

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NOTE 2:  (Continued)                                                            

         Properties held for sale are classified as current or non-current based
 on the estimated date of sale and the time at which the related
receivable is expected to be collected by the Company.        

As mentioned in Note 2.m, at June 30, 2002, the Company set up
       provisions for impairment of certain inventories (identified as Avda.
        Madero 1020, Rivadavia 2768, Constitucion 1111, Terrenos de Caballito,
Padilla 902 and parking lots in Dock 13).                     

        The provision amounted to $ 10,210 thousand and is shown under "Result
        from operations and holding of real estate assets" in the Statement of
Income at June 30, 2002. (See Schedule E and F)               

         The accounting value of inventories, net of provisions set up, does not
exceed estimated recoverable value.                           

c.  Fixed assets                                                      

     Fixed assets, net comprise primarily of rental properties and other
property and equipment held for use by the Company.           

         Fixed assets value, net of provisions set up, does not exceed estimated
recoverable value.                                            

o  Rental properties                                          
      Rental properties are carried at cost, adjusted for inflation at the
end of the year, as defined in Note 1.b), less accumulated    
        depreciation. Costs incurred for the acquisition of the properties are
capitalized. Accumulated depreciation is computed under the   
     straight-line method over the estimated useful lives of the assets,
which generally are estimated to be 50 years for buildings and
     improvements. Expenditures for ordinary maintenance and repairs are
         charged to operations in the year incurred. Significant renovations and
        improvements, which improve or extend the useful life of the asset are
       capitalized and depreciated over its estimated remaining useful life.
      At the time depreciable assets are retired or otherwise disposed of,
        the cost and the accumulated depreciation of the assets are eliminated
from the accounts and any profit or loss is recognized.       

         The Company capitalizes interest on long-term construction projects. No
         interest costs were capitalized during the year ended June 30, 2002 and
2001.                                                         

As mentioned in Note 2.m, at June 30, 2002, the Company set up
       provisions for impairment of certain rental properties (identified as
      Libertador 498, Maipu 1300, Avda. Madero 1020, Suipacha 652, Laminar
      Plaza, Reconquista 823, Constitucion 1111, Dique 2 M10- Edificio C-.
     Libertador 602, Dock 2 M10 -Building A-, Avda. Madero 942, Avda. De
Mayo 595, Costeros Dique IV and Sarmiento 517).               

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NOTE 2:  (Continued)                                                            

                  The provision amounted to $ 37,599 thousand and is shown under
                 "Result from operations and holding of real estate assets" in
               the Statement of Income at June 30, 2002. (See Schedule E).

     o Software obtained or developed for internal use

             The Company capitalizes certain costs associated with the
            development of computer software for internal use. Costs
                 capitalized during the year ended June 31, 2002 and 2001 were
      not material. These costs are being amortized on a
 straight-line basis over a period of 3 years.

o Other properties and equipment            

                Other property and equipment properties are carried at cost,
                adjusted for inflation at the end of the year, as defined in
         Note 1.b), less accumulated depreciation. Accumulated
                depreciation is computed under the straight-line method over
                 the estimated useful lives of the assets, as specified below:

        Asset                        Estimated useful life (years)
------------------------------------------------------------------------------- 
Leasehold improvements                            On contract basis             
Facilities                                                10                    
Machinery and equipment                                   10                    
Furniture and fixtures                                    5                     
Computer equipment                                        3                     

                The cost of maintenance and repairs is charged to expense as
               incurred. The cost of significant renewals and improvements
              are added to the carrying amount of the respective assets.
                  When assets are retired or otherwise disposed of, the cost and
         related accumulated depreciation are removed from the
accounts.                                   

d.    Intangible assets                                       

              Intangible assets are carried at cost, adjusted for inflation at
           the end of the year as defined in Note 1.b), less accumulated
depreciation.                                     

o Deferred Financing Cost                         

           Expenses incurred in connection with the issuance of debt and
          proceeds of loans have been deferred and are being amortized
               using the interest method over the life of the related issuances.
               In the case of repurchase of this notes, the related expenses are
amortized using the proportional method.          

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NOTE 2:  (Continued)                                                            

o Selling and advertising expenses                

       Expenses incurred relating to the marketing of developing
      properties, including advertising, commissions and other
               expenses, are charged to expense in the year in which the related
revenue is earned, as determined under the        
percentage-of-completion method.                  

e.    Foreign currency assets and liabilities                 

        Assets and liabilities denominated in foreign currency are
     translated at the exchange rate prevailing at year end.
           Transactions denominated in foreign currencies are translated
        into pesos at the prevailing exchange rates on the date of
            transaction settlement. Foreign currency transaction gains and
losses are recorded within financial results, net.

             Pursuant to Decree No. 214/02 and Decree No. 762/02, assets and
      debts in U.S. dollars or other foreign currencies in the
              Argentine financial system as of January 6, 2002, were converted
          to pesos at the rate of exchange of Ps. 1 per US$ 1 and were
              adjusted by a reference stabilization index (CER) or a reference
of salary variation, as applicable.               

f.    Monetary assets and liabilities                         

            Monetary assets and liabilities are stated at their face value
plus or minus the related financial gain or loss. 

g.    Income tax                                              

     The statutory income tax rate was 35% for all the years
       presented. The Company does not recognize deferred taxes.

            As permitted under Argentine income tax law in determining its
              taxable income for the year ended June 30, 2002, the Company has
         taken into consideration tax losses of approximately $337,2
million.                                          

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NOTE 2:  (Continued)                                                            

       As of June 30, 2002, the Company had accumulated tax loss
               carryforwards of approximately Ps. 366,4 million, which expire as
follows:                                          

Maturity                                             $  
          ---------------------------------------      ---------------------
      2003                                                        81
      2004                                                       535
      2005                                                    28.440
      2006                                                       137
      2007                                                   337.194
                                                       ---------------------
          Total                                        $         366.387 (*)

        (*) includes only one fifth of net losses due to the
           devaluation, as explained in Note 1 to the consolidated
financial statements.                       

h.    Asset tax                                               

               During the year ended June 30, 1999, Law 25,063 set out the asset
             tax for four fiscal years. This tax supplements the income tax,
              because while the latter is levied on the taxable income for the
             year, the asset tax is levied on the potential yield of certain
         assets at a 1% rate, and the Company's tax liability is the
higher of both taxes.                             

     Law 25,360 modified law 25,063 by extending the term of
application to ten fiscal years.                  

            Any excess of the asset tax over and above the income tax in a
            given fiscal year may be considered as a payment on account of
              the income tax to be generated in the next four years (in excess
of the asset tax).                                

          As of June 30, 2002 the Company has estimated the applicable
             asset tax and has reflected the portion it estimates it will be
            able to offset in future years in line with the rules in force
             under other (current and non-current) receivables, charging the
remaining portion to income currently.            

i.    Customer advances                                       

         Customer advances represent payments received in advance in
connection with the sale and rent of properties.  

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NOTE 2:  (Continued)                                                            

j.    Provisions for allowances and contingencies             

             The Company provides for losses relating to mortgage, lease and
               other accounts receivable. The allowance for losses is recognized
           when, based on current information and events, it is probable
        that the Company will be unable to collect all amounts due
        according to the terms of the agreements. The allowance is
               determined on a one-by-one basis considering the present value of
              expected future cash flow or the fair value of collateral if the
             loan is collateral dependent, when applicable. While management
        uses the information available to make evaluations, future
              adjustments to the allowance may be necessary if future economic
          conditions differ substantially from the assumptions used in
          making the evaluations. Management has considered all events
           and/or transactions that are subject to reasonable and normal
               methods of estimations, and the consolidated financial statements
reflect that consideration.                       

            The Company has certain contingent liabilities with respect to
           existing or potential claims, lawsuits and other proceedings,
            including those involving labor and other matters. The Company
               accrues liabilities when it is probable that future costs will be
       incurred and such costs can be reasonably estimated. Such
       accruals are based on developments to date, the Company's
          estimates of the outcomes of these matters and the Company's
              lawyers' experience in contesting, litigating and settling other
              matters. As the scope of the liabilities becomes better defined,
          there may be changes in the estimates of future costs, which
             could have a material effect on the Company's future results of
operations and financial condition or liquidity.  

k.    Advertising expenses                                    

               The Company generally expenses advertising and promotion costs as
               incurred with the exception of advertising and promotion expenses
      incurred to market real estate projects. Advertising and
               promotion expenses were approximately Ps. 859 and Ps. 644 million
      for the year ended June 30, 2002 and 2001, respectively.

l.    Pension information                                     

             The Company does not maintain any pension plans. Argentine laws
               provide for pension benefits to be paid to retired employees from
             government pension plans and/or privately managed funds plan to
which employees may elect to contribute.          

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NOTE 2:  (Continued)                                                            

m.    Impairment of long-lived assets                         

        The Company regularly evaluates its non-current assets for
          recoverability. The Company considers that impairment losses
        arise when the recoverable value is lower than book value.
          Impairment losses must be appropriated to the result for the
      period. The recoverable value is mainly determined using
           independent estimates or projections of future cash flows. At
        June 30, 2002, due to the progressive deterioration of the
              Argentine economy and the impact on the Company's revenue of the
             measures adopted by the National Government mentioned in Note 1
       to the consolidated financial statements, the Company has
          reevaluated the recoverable value of its non-current assets,
             recording an impairment loss as the valuation of certain assets
             has exceeded the estimated recoverable value. (See Schedule E).

n.    Financial derivatives                                   

             The Company uses various financial derivatives to hedge its net
            investment in foreign operations and as a complement to reduce
its global financial costs.                       

             The Company does not engage in trading or other speculative use
               of these financial instruments. Additionally, the Company has not
               used financial instruments to hedge transactions foreseen or firm
          commitments. To be eligible for hedging, the Company must be
          exposed to currency or interest rate risk, and the financial
               instrument must reduce the exposure and be designated as such. In
             addition, for hedging purposes, the significant characteristics
              and expected terms of the planned transaction must be identified
      and the expected transaction must be probable. Financial
          instruments that can be recorded as hedging instruments must
            maintain a high correlation between the hedging instrument and
          the item being hedged at the beginning and during the entire
hedging period.                                   

          The Company formally documents all the relationships between
       hedging instruments and hedged items, as well as its risk
           management objective and strategy before embarking on hedging
               transactions. This process includes detailing all the derivatives
              designated for hedging of specific assets and liabilities in the
   balance sheet or specific firm commitments or planned
               transactions. The Company also evaluates both at the beginning of
         the hedging transaction and on an ongoing basis whether the
            derivatives used in hedging transactions are very effective to
           offset fluctuations in the market values or cash flows of the
             items hedged. If it is determined that a derivative is not very
             effective for hedging or that it has stopped being an effective
        cover, the Company would discontinue the recording of such
hedging instrument in the future.                 

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NOTE 2:  (Continued)                                                            

- Foreign currency forward-exchange contracts     

           In accordance with the Company's risk management policies, it
              uses long-term foreign currency purchase and sale contracts as a
            supplement to reduce its overall financial costs as well as to
            administer its exposure regarding net investments in financial
               transactions. Foreign currency forward-exchange contracts entered
               into by the Company generally mature within one year. Premiums on
            foreign currency forward-exchange contracts are amortized over
the life of the respective contracts.             

- Interest rate swaps                             

           Interest rate swaps are used to hedge interest rate exposure.
               Interest rate swaps are recognized on an accrual basis, recording
          the net amount receivable or payable as an adjustment to the
             interest rate expense. The accrued amount receivable or payable
               is included as an adjustment to the interest expense. Upon expiry
          or termination of a swap, the net income or loss realized or
           pending realization is recognized over the remaining original
           term if the hedged item remains unpaid, or immediately if the
       underlying hedged item is not unpaid. If the swap has not
           expired, or if it expires before maturity, but the underlying
               hedged item is no longer unpaid, the unrealized income or loss on
the interest swap is immediately recognized.      

o.    Shareholders' equity                                    

               Opening balances and account movements are stated in the currency
             of the month to which they correspond, restated as mentioned in
Note 1.b).                                        

p.    Results for the year                                    

The results for the year are shown as follows:    

            -  Income accounts are shown in currency of the month to which
                they correspond, and have been restated as mentioned in Note
1.b).                                       

       -  Charges for assets consumed (fixed asset depreciation,
         intangible asset amortization and cost of sales) were
            determined based on the values recorded for such assets.

               -  Financial gains and losses are included in Note 8, broken down
         to show those generated by assets and by liabilities.

            -  Income/(loss) from investments in controlled and affiliated
                 companies was calculated under the equity method, by applying
          the percentage of the Company's equity interest to the
income/(loss) of such companies.            

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NOTE 2:  (Continued)                                                            

q.    Estimations                                             

             The preparation of the financial statements requires management
        to make estimates and assumptions that affect the reported
             amounts of assets and liabilities, the disclosure of contingent
    assets and liabilities as of the date of the financial
               statements, and the reported amounts of revenues and expenses for
  the year. Estimates are used when accounting for the
          depreciation, amortization, impairment of long-lived assets,
         income taxes and contingencies. Future actual results could
               differ from the estimates and assumptions prepared at the date of
these financial statements.                       

r.    Revenue recognition                                     

r.1.  Sales of properties                                     

     The Company records revenue from the sale of properties
            classified as inventory when all of the following criteria are
met:                                              

o  the sale has been consummated;                 

        o  there is sufficient evidence to demonstrate the buyer's
   ability and commitment to pay for the property;

  o  the Company's receivable is not subject to future
subordination; and                          

       o  the Company has transferred the property to the buyer.

     The Company uses the percentage-of-completion method of
              accounting with respect to sales of development properties under
           construction effected under fixed-price contracts. Under this
       method, revenue is recognized based on the ratio of costs
             incurred to total estimated costs applied to the total contract
               price. The Company does not commence revenue and cost recognition
            until such time as the decision to proceed with the project is
made and construction activities have begun. The  
        percentage-of-completion method of accounting requires the
               Company's management to prepare budgeted costs in connection with
          sales of properties/units. All changes to estimated costs of
           completion are incorporated into revised estimates during the
contract period.                                  

r.2.  Leases                                                  

              Revenues from leases are recognized over the life of the related
             lease contracts. All revenues are presented net of taxes levied
on sales.                                         

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NOTE 2:  (Continued)                                                            

s.    Cash and cash equivalents                               

               The Company considers all highly liquid investments with original
              maturities of three months or less, consisting primarily of time
deposits, to be cash equivalents.                 

t.    Result from operations and holding of real estate       

           The results from operations and holding of real estate assets
              include the results provided by the valuation and sale of shares
        in real estate investment companies and the results due to
impairment of real estate assets.                 

             At June 30, 2002, the amounts recorded total $ 53 and $ 60,372,
respectively. (See Schedule E)                    

NOTE 3:  MORTGAGES AND LEASES RECEIVABLES                                       

The breakdown for this item is as follows:                    

                                                        [Enlarge/Download Table]

                                                       June 30,                    June 30,           
                                                          2002                       2001             
                                              --------------------------------------------------------
                                                Current     Non-current    Current     Non-current    
                                              --------------------------------------------------------
                                                                                                      
Mortgages and leases receivable                    4,252            529      18,363          33,251   
Debtors  under legal proceedings                   1,815              -       8,283               -   
Intercompany (Note 10 a.)                          3,390          1,729       7,017           1,854   
Less:                                                                                                 

Allowance for doubtful accounts (Schedule E)      (1,073)             -      (1,678)              -   
                                              ========================================================
                                                   8,384          2,258      31,985          35,105   
                                              ========================================================

        As of June 30, 2002, current and non-current receivables from the sale
      of real estate are secured by first degree mortgages in favor of the
Company.                                                      

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NOTE 4:  OTHER RECEIVABLES                                                      

The breakdown for this item is as follows:                    

                                                        [Enlarge/Download Table]

                                                    June 30,                    June 30,          
                                                      2002                        2001            
                                         ---------------------------------------------------------
                                            Current      Non-current    Current    Non-current    
                                         ---------------------------------------------------------
                                                                                                  
Income tax prepayments and withholdings                                                           
Asset tax (Note 2 h.)                           2,077          11,665     2,909          22,756   
Value Added Tax (VAT)                              55               -       164               -   
C.N. Hacoaj Project                               593               -     1,363               -   
Intercompany (Note 10 a.)                      43,478          73,309     3,828           2,551   
Guarantee deposits                                  -              38         -              74   
Expenses to recover                             1,333               -     1,541               -   
Gross sales tax                                     4               -         -               -   
Income tax advances                                63               -       227               -   
Operating pending settlement                      315               -       939               -   
Trust accounts receivable                           -             361         -               -   
Credit Fiscal Certificates                      2,312               -         -               -   
Other                                           2,246               -     2,245               -   
                                         =========================================================
                                               52,476          85,373    13,216          25,381   
                                         =========================================================

        As of June 30, 2002, current and non-current receivables from the sale
      of real estate are secured by first degree mortgages in favor of the
Company.                                                      

NOTE 5:  INVENTORY                                                              

The breakdown for this item is as follows:                            

                                                                [Download Table]

                               June 30,                  June 30,           
                                 2002                       2001            
                      ------------------------------------------------------
                         Current    Non-current    Current    Non-current   
                      ------------------------------------------------------
                                                                            
Real estate for sale        8,901       22,615        5,734        27,260   
                      ======================================================
                            8,901       22,615        5,734        27,260   
                      ======================================================

         The book value at June 30, 2002 includese a provision for impairment as
mentioned in Note 2.b.                                        

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NOTE 6:  SHORT AND LONG TERM DEBT                                               

The breakdown for this item is as follows:                    

                                                        [Enlarge/Download Table]

                                                    June 30,                    June 30,            
                                                      2002                         2001             
                                          ----------------------------------------------------------
                                             Current     Non-current      Current     Non-current   
                                          ----------------------------------------------------------
                                                                                                    
Bank loans (1)                                 306,748             -        209,313             -   
Accrued interest - bank loans (1)                7,210             -          2,866             -   
Commercial paper - capital (2)                       -             -         48,905             -   
Commercial paper interest (2)                        -             -           (910)            -   
Negotiable Obligations - 2001- principal                                                            
amount (3)                                     149,249             -         85,095             -   
Negotiable Obligations - 2001 -accrued                                                              
interest (3)                                       540             -          1,371             -   
Other                                           57,423             -              -             -   
                                          ----------------------------------------------------------
                                               521,170             -        346,640             -   
                                          ==========================================================

        (1)   a) In May 2000, the Company obtained a syndicated loan amounting
          to US$ 80,000 thousand through Bank Boston (leader of a bank
         syndicate) repayable in 24 months, bearing interest payable
         quarterly at the LIBO rate over three months plus 500 basic
             points. At June 30, 2002, the interest rate accrued on the loan
was 6.99%.                                        

              As from December 2001 the Company initiated a loan renegotiation
             process, as a result of which the loan maturity was extended to
             September 30, 2002. The contract terms require that the Company
             maintain certain ratios and financial conditions, certain rates
      and indebtedness levels and sets restrictions on certain
        investments, payments, obtaining of new loans and sales of
certain assets and capital investments.           

            As a result of the current economic situation, the Company has
             been unable to comply with certain financial ratios established
            by the loan agreement. At the date of issue of these financial
           statements, a waiver for the Company's failure to observe the
        above ratios at June 30, 2002 was obtained. b) Other debts
amounting to $ 2,750 are included in this line.   

     2.    At June 30, 2002 all the negotiable obligations were settled.

       3.    On December 21, 2000, the Board of Directors approved the issue
            of Class 02 negotiable obligations for US$ 43,500 thousand, in
             denominations of US$ 10,000 and multiples of US$ 1,000. the net
               proceeds from the negotiable obligations were appropriated to the
              settlement of the loan from Banca Nazionale del Lavoro amounting
            to US$ 21,763 thousand, HSBC for US$ 14,838 thousand and Banco
Sudameris for US$ 6,449 thousand.                 

               The notes would be fully settled within 365 days from issue, i.e.
        on December 20, 2001, accruing interest at a floating rate
          payable quarterly in arrears. During the quarter at June 30,
              2002, the Company has repurchased part of the notes, so that the
            new value, including capitalized interest, amounts to US$ 40.1
          million. The notes were repurchased with National Government
        bonds, which has generated net income of approximately $ 9
         million, which is shown under Financing effects, net in the
Statement of Income at June 30, 2002.             

           As from December 2001, the Company has initiated a negotiable
            obligation renegotiation process, as a result of which the due
date has been postponed to September 9, 2002.     

              The Board of Directors has requested consideration of a proposal
             to modify financial ratios and a waiver for non-compliance with
            the above ratios after March 31, 2002. At the date of issue of
           these financial statements no waiver for the infringements at
June 30, 2002 has yet been obtained.              

          The loans indicated in 1 a) and those indicated in 3 contain
          "cross - default provision" in connection with the financial
          instruments of our subsidiary APSA, as described in Note 12.

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NOTE 7:  OTHER LIABILITIES                                                      

The breakdown for this item is as follows:                    

                                                        [Enlarge/Download Table]

                                                  June 30,                     June 30,            
                                                     2002                        2001              
                                         ----------------------------------------------------------
                                           Current     Non-current     Current      Non-current    
                                         ----------------------------------------------------------
                                                                                                   
Seller financing                                786            725         1,602           2,836   
Intercompany (Note 10 a.)                        43            503         1,768               -   
Lessee deposits                                 713            718           876           2,770   
Provision for discounts (Schedule E)             11              -            22               -   
Provision for lawsuits (Schedule E)             204              -            10               -   
Fees payable                                      5              -           188               -   
Directors' deposits                               -              8             -              16   
Sundry creditors                                107              -             -               -   
Fund administration                               9              -             1               -   
Collections on behalf  of third parties          50              -           188               -   
Other                                           414              -           582               -   
                                         ==========================================================
                                              2,342          1,954         5,237           5,622   
                                         ==========================================================

NOTE 8:  FINANCIAL RESULTS, NET                                                 

The breakdown for this item is as follows:                    

                                                                [Download Table]

                                                June 30,           June 30,   
                                                   2002             2001      
                                             ---------------- ----------------
                                                                              
FINANCIAL RESULTS GENERATED BY ASSETS:                                        
Interest income                                        352            3,488   
Exchange (loss) gain                                14,800              106   
(Loss) gain on exposure to inflation              (82,577)                -   
(Loss)/gain on financial operations               (33,375)            3,721   
                                             ---------------- ----------------
                                                 (100,800)            7,315   
                                             ---------------- ----------------
FINANCIAL RESULTS GENERATED BY LIABILITIES:                                   
Discounts                                                 -             (49)  
Exchange (loss) gain                              (262,745)             (55)  
(Loss) gain on exposure to inflation                 49,015                -  
Financial expenses (Schedule H)                    (49,803)         (60,852)  
                                             ---------------- ----------------
                                                  (263,533)         (60,956)  
                                             ================ ================
FINANCIAL RESULTS, NET                            (364,333)         (53,641)  
                                             ================ ================

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NOTE 9:  OTHER INCOME AND EXPENSES, NET                                         

The breakdown for this item is as follows:                    

                                                                [Download Table]

                                           June 30,         June 30,   
                                             2002             2001     
                                      ---------------- ----------------
                                                                       
OTHER INCOME:                                                          
Other                                           583              501   
                                      ---------------- ----------------
                                                583              501   
                                      ---------------- ----------------
OTHER EXPENSES:                                                        
Unrecoverable VAT                              (974)          (2,866)  
Donations                                       (76)          (1,610)  
Debit and credit tax                         (1,407)            (446)  
Other                                          (474)            (538)  
                                      ---------------- ----------------
                                             (2,931)          (5,460)  
                                      ---------------- ----------------
TOTAL OTHER INCOME AND EXPENSES, NET         (2,348)          (4,959)  
                                      ================ ================

NOTE 10: BALANCES AND TRANSACTIONS WITH INTERCOMPANY                            

  a.    The balances as of June 30, 2002 and 2001 with controlled,
affiliated and related companies are as follows:  

                                                                [Download Table]

                                             June 30,       June 30,     
                                               2002           2001       
                                          --------------- ---------------
                                                                         
ABRIL S.A.                                                               
----------                                                               
Current mortgages and leases receivables             9               -   
Other current receivables                            -           3,093   

BALDOVINOS S.A.                                                          
---------------                                                          
Current mortgages and leases receivables           723           5,552   
Non-current mortgages receivables                   91           1,854   
Other current liabilities                           35             175   

HOTELES ARGENTINOS S.A.                                                  
-----------------------                                                  
Other current receivables                            -               -   
Other current receivables                            -              10   
Current accounts payable                             -              23   

INVERSORA BOLIVAR S.A.                                                   
----------------------                                                   
Current mortgages and leases receivables         1,941             288   
Other current receivables                            7               -   
Current accounts payable                             -             286   

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NOTE 10: (Continued)                                                            

                                                                [Download Table]

                                                 June 30,       June 30,     
                                                   2002           2001       
                                              --------------- ---------------
                                                                             
ALTO PALERMO S.A.                                                            
-----------------                                                            
Current mortgages and leases receivables               384             188   
Non current mortgages and leases receivables         1,638               -   
Current accounts payable                                 -               -   
Other non current receivables                       73,160               -   
Current trade accounts payable                         140              96   
Other current liabilities                                -               -   
Other non-current liabilities                          503               -   

RED ALTERNATIVA S.A.                                                         
--------------------                                                         
Current mortgages and leases receivables                 5              18   

ALTERNATIVA GRATIS S.A.                                                      
-----------------------                                                      
Current mortgages and leases receivables                 1               8   

BANCO HIPOTECARIO S.A.                                                       
----------------------                                                       
Current investments                                  1,957               -   
Current mortgages and leases receivables                 2               2   
Other current receivables                                1               -   

BANCO DE CREDITO Y SECURITIZACION S.A                                        
-------------------------------------                                        
Non-current investments                              6,236               -   

ALTO INVEST S.A.                                                             
----------------                                                             
Current mortgages and leases receivables                 -              23   

DOLPHIN FUND MANAGEMENT S.A.                                                 
----------------------------                                                 
Current mortgages and leases receivables               128             309   
Other current receivables                               58               -   
Current accounts payable                                45               -   

CRESUD S.A.C.I.F.                                                            
-----------------                                                            
Current mortgages and leases receivables               132             254   
Current accounts payable                                42               -   
Current trade accounts payable                           -               -   
Other current liabilities                                5               -   

EMPRENDIMIENTOS RECOLETA S.A.                                                
-----------------------------                                                
Current mortgages and leases receivables                 -              25   
Other current receivables                               20               -   
Current trade accounts payable                           4               -   

TARSHOP SOCIEDAD ANONIMA                                                     
------------------------                                                     
Current mortgages and leases receivables                                     

ALTOCITY.COM S.A.                                                            
-----------------                                                            
Current mortgages and leases receivables                54             180   

LATIN AMERICAN ECONETWORKS N.V.                                              
-------------------------------                                              
Current mortgages and leases receivables                 -             105   

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NOTE 10: (Continued)                                                            

                                                        [Enlarge/Download Table]

                                                                    June 30,       June 30,     
                                                                      2002           2001       
                                                                 --------------- ---------------
                                                                                                
FUTUROS Y OPCIONES S.A.                                                                         
-----------------------                                                                         
Current mortgages and leases receivables                                    -              12   
Non Current accounts payable                                                -               -   

FIBESA S.A.                                                                                     
-----------                                                                                     
Current mortgages and leases receivables                                    -              10   
Current accounts payable                                                    2               -   

CACTUS S.A.                                                                                     
-----------                                                                                     
Current mortgages and leases receivables                                    -               4   
Current trade accounts payable                                              -               -   

IRSA INTERNATIONAL LIMITED                                                                      
--------------------------                                                                      
Other current receivables                                                   -               -   
Other current liabilities                                                   -               -   

PALERMO INVEST                                                                                  
--------------                                                                                  
Other current receivables                                              13,135               -   
Other current liabilities                                                   -           1,307   

RITELCO S.A                                                                                     
-----------                                                                                     
Other current receivables                                              30,129               -   

NUEVAS FRONTERAS S.A.                                                                           
---------------------                                                                           
Current accounts payable                                                    -               -   

SAPSA                                                                                           
-----                                                                                           
Current mortgages and leases receivables                                    -               -   

TARSHOP S.A.                                                                                    
------------                                                                                    
Current mortgages and leases receivables                                   11              39   
Other current liabilities                                                   3               -   

UNIVERSAL REAL STATE S.A.                                                                       
-------------------------                                                                       
Current mortgages and leases receivables                                    -               -   

PRESTAMOS AL PERSONAL                                                                           
---------------------                                                                           
Managers, Directors and other current Staff of the Company                129             725   
Managers, Directors and other non- current Staff of the Company           149           2,551   

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NOTE 10: (Continued)                                                            

   b.    Gain/(loss) on controlled, affiliated and related companies
           during the years ended June 30, 2002 and 2001 are as follows:

                                                        [Enlarge/Download Table]

                                            Sales and  Recovery    Resultado                                     
                                             service       of      Tenencia    Recovery    Interest   Interest   
                                  Year        fees      expenses   (Perdida)  of expenses   Earned      Lost     
                               ----------------------------------------------------------------------------------
                                                                                                                 
INTERCOMPANY                                                                                                     

Abril S.A.                        2002              -          -         -             -          -          -   
                                  2001            106          -         -             -          -          -   
Alto Palermo S.A.                 2002              -          -         -             -     10,691          -   
                                  2001            153          -         -             -          -          -   
Inversora Bolivar S.A.            2002            903          -         -         1,507          -          -   
                                  2001              -          -         -         1,360          -        110   
Hoteles Argentinos S.A.           2002              -          -         -             -          -          -   
                                  2001              -          -         -             -      1,716          -   
Alto Invest S.A.                  2002              -          -         -             -          -          -   
                                  2001              -         18         -             -          -          -   
Altocity.Com S.A.                 2002              -        207         -             -          -          -   
                                  2001            139        329         -             -          -          -   
Alternativa Gratis S.A.           2002              -          -         -             -          1          -   
                                  2001             39        129         -             -          -          -   
Palermo Invest S.A                2002              -          -         -             -          -          -   
                                  2001              -          -         -             -          -          -   
Cresud S.A                        2002              -        147         -             -        410          -   
                                  2001            125          -         -             -          -          -   
Econetworks Argentina S.A.        2002              -          -         -             -          -          -   
                                  2001             31        207         -             -          -          -   
Emprendimiento Recoleta S.A.      2002              -          -         -             -          -          -   
                                  2001             80          -         -             -          -          -   
Fibesa S.A                        2002              -          -         -             -          -          -   
                                  2001             29          -         -             -          -          -   
Futuros y Opciones S.A.           2002              -          -         -             -          -          -   
                                  2001             43          -         -             -          -          -   
Red Alternativa S.A.              2002              -         47         -             -          -          -   
                                  2001             88          -         -             -          -          -   
Tarshop S.A.                      2002              -         72         -             -          -          5   
                                  2001             98          -         -             -          -          -   
Dolphins Found Management S.A.    2002              -          -         -             -          -          -   
                                  2001            119         59         -             -          -          -   
Cactus S.A                        2002              -          -         -             -          -          -   
                                  2001              8          -         -             -          -          -   
Prestamos al personal             2002              -          -         -             -        120          -   
                                  2001              -          -         -             -        311          -   
Banco Hipoticario S.A.            2002              -          -       738             -          -           -  
                                  2001              -          -       303             -          -           -  
                                           ----------------------------------------------------------------------
Total 2002                                        903        473       738         1,507     11,222          5   
                                           ======================================================================
Total 2001                                      1,058        742       303         1,367      2,027        110   
                                           ======================================================================

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NOTE 10: (Continued)                                                            

  c.    The composition of intercompany gain/(loss) is as follows:

                                                        [Enlarge/Download Table]

                                                                  (Loss) income        
                                                           ----------------------------
                                                              June 30,       June 30,  
                                                                2002           2001    
                                                           ----------------------------
                                                                                       
Equity in earnings of controlled and affiliated companies       (45,744)     (14,671)  
Amortization of intangible assets and investments               (26,478)         (998) 
                                                           ==============  ============
                                                                (72,222)     (15,669)  
                                                           ==============  ============

NOTE 11: COMMON STOCK                                                           

a.    Common stock                                            

       As of June 30, 2002, IRSA's capital stock was as follows:

                                                        [Enlarge/Download Table]

==================================================================================================
                                                    Approved by                                   
                                         -----------------------------------                      
                                                                             Date of record with  
                                                                             the Public Registry  
                              Par Value           Body              Date         of Commerce      
--------------------------------------------------------------------------------------------------
                                                                                                  
Shares issued for cash                -  First Meeting for       04.05.1943      06.25.1943       
                                         IRSA's Incorporation                                     

Shares issued for cash           16,000  Extraordinary           11.18.1991      04.28.1992       
                                         Shareholders' Meeting                                    

Shares issued for cash           16,000  Extraordinary           04.29.1992      06.11.1993       
                                         Shareholders' Meeting                                    

Shares issued for cash           40,000  Extraordinary           04.20.1993      10.13.1993       
                                         Shareholders' Meeting                                    

Shares issued for cash           41,905  Extraordinary           10.14.1994      04.24.1995       
                                         Shareholders' Meeting                                    

Shares issued for cash            2,000  Extraordinary           10.14.1994      06.17.1997       
                                         Shareholders' Meeting                                    

Shares issued for cash           74,951  Extraordinary           10.30.1997      07.02.1999       
                                         Shareholders' Meeting                                    

Shares issued for cash           21,090  Extraordinary           04.07.1998      04.24.2000       
                                         Shareholders' Meeting                                    

Shares issued for cash               54  Board of Directors'     05.15.1998      07.02.1999       
                                         Meeting                                                  
                             ------------                                                         
                                212,000                                                           
Treasury Stock                   (4,588)                                                          
                             ------------                                                         
                                207,412                                                           
==================================================================================================

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NOTE 11: (Continued)                                                            

a.    Common stock (Continued)                                
------------                                      

            At June 30, 2002, the negative results recorded by the Company
               use up over 50% of capital stock and reserves. Section 206 of the
               Corporations Law establishes obligatory capital reduction in such
           circumstances. However, as a result of the Argentine economic
           crisis, by Decree 1269, the National Government suspended the
  application of this section until December 10, 2003.

          The Shareholders' Ordinary and Extraordinary Meeting held on
             October 19, 2001 corresponding to the year ended as of June 30,
2001, approved, among other things, the following:

            -  Not to distribute 4,587,285 treasury stock in proportion to
          the respective interests of the shareholders, avoiding
                delegating implementation of share distribution to the Board
of Directors.                               

-  The mergers with Home Financing S.A.           

        -  Approve the duties discharged by the Board of Directors
               regarding the financial assistance provided to Alto Palermo
                 S.A. (APSA), in connection with the restructuring of the swap
                contract entered into with Morgan Guarantee Trust, regarding
             the issuance of APSA's negotiable obligations maturing in
2005.                                       

b.    Treasury stock                                          
--------------                                    

              The Company repurchases periodically outstanding ordinary shares
              when it considers that their price is undervalued on the market.

         During 2001, the Company repurchased 19,079,995 outstanding
    ordinary shares for a total of thousand $ 80,431. This
             acquisition was recorded as "Treasury shares" and resulted in a
reduction of accumulated results.                 

During 2002 no treasury shares were bought.       

c.    Restriction on the distribution of profits              
------------------------------------------        

       In accordance with the Argentine Corporations Law and the
               Company's By-laws, 5% of the net and realized profit for the year
            calculated in accordance with Argentine GAAP plus (less) prior
        year adjustments must be appropriated by resolution of the
              shareholders to a legal reserve until such reserve equals 20% of
               the Company's outstanding capital. This legal reserve may be used
only to absorb losses.                            

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NOTE 11: (Continued)                                                            

d.   Noncontributory Management Stock Ownership Plan        
-----------------------------------------------   

             On October 30, 1997, the shareholders authorized the Company to
          enter into a Noncontributory Management Stock Ownership Plan
         ("NMSOP") with eight executive officers of the Company (the
        "Beneficiaries"), pursuant to which the Beneficiaries were
             granted the right to purchase up to 24 million shares of common
              stock (the "Participation Shares"), at a purchase price equal to
           Ps. 1.0 per share, subject to the implementation of an Equity
               Participation Agreement ("EPA"). Under Argentine law, the Company
         established a special purpose trust in this connection (the
"Trust").                                         

           The Beneficiaries were required to purchase the Participation
       Shares available, if any, within 24 months of any capital
              increase. The Trust has an original term of six years. According
            to the terms of the NMSOP and the Trust, Beneficiaries are not
          entitled to receive any distributions (either in the form of
              shares, cash or other) from the Trust during its term, although,
        Beneficiaries are allowed to cause the Trust to sell their
            designated shares of common stock held by the Trust in certain
          cases. In addition, the Company was not allowed to grant any
          loans or otherwise assist the Beneficiaries in financing the
purchase of the Participation Shares.             

               On April 7, 1998, the Company's shareholders, at an extraordinary
              shareholders' meeting, approved a capital increase of 24 million
       shares to permit the Beneficiaries to purchase all of the
             Participation Shares to which they were entitled under the EPA.

           The BASE and the CNV approved the capital increase on June 4,
     1999, and on August 31, 1999 the Beneficiaries acquired
21,090,024 shares at Ps. 1.0 per share.           

NOTE 12: FINANCIAL LOANS TO ALTO PALERMO S.A.                                   

       As a result of the economic situation, at June 30, 2002, Alto Palermo
         S.A., was unable to comply with certain financial ratios established in
       the Trust Agreement signed in connection with the issue of negotiable
  obligations amounting to $ 120 million and other unsecured notes
         amounting to $ 85 million. After the end of the year, Alto Palermo S.A.
         called an Extraordinary Noteholders' Meeting for August 22, 2002, which
  decided to grant a waiver on non-compliance with the commitments
contained in the Specific Commitments clause, financial ratios
       sub-clause, in the Price Supplement on Negotiable Obligations Class A
       dated January 15, 2001 during the quarter between April 2002 and June
      30, 2002, without this implying a waiver of such infringements after
         June 30, 2002 or changes to those commitments in the future. No waiver,
however, was obtained in connection with                      

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NOTE 12:  (Continued)                                                           

         general unsecured obligations amounting to $ 85 million. As a result of
     this refusal, Alto Palermo S.A. cannot incur aditional indebtedness
     until that event of default has been resolved. After the end of the
     year, Alto Palermo S.A. redeemed Clase A2 notes for a total nominal
value of $ 17 million.                                        

      In order to minimize its financing costs and to manage interest rate
       exposure, the Company entered into an interest rate swap agreement to
       effectively convert a portion of its peso-denominated fixed-rate debt
to peso-denominated floating rate debt. As a result of recent 
       unforseable economic developments in Argentina, the implicit rates on
      futures in pesos or dollars reached totally unexpected values, which
         gave rise to the requirement for additional guarantees for the exchange
        rate swap entered into with Morgan Guaranty Trust Company of New York.
        Consequently, on July 20, 2001, the Board of Directors of Alto Palermo
    S.A. entered into a new swap agreement amounting to US$ 85,000,000
         securing this operation with a collateral deposit of US$ 50,000,000 and
     eliminating the rate risk implicit in futures in pesos and dollars.
       This guarantee was financed through a loan agreement with the Company
  for an original amount of $ 47,210,926. Payment of principal and
interest on those contracts was subordinated to the payment of
       principal and interest on bonds and payment of principal and interest
on the short-term financial debt.                             

NOTE 13: RESTRICTED ASSETS                                                      

      -     The Labor Court No. 55 decided the embargo of units No. 14 and
      20 located in Sarmiento 517, property of the Company, in
            connection with a lawsuit in which the Company is codefendant.

    -     In connection with the acquisition of additional interest in
              Santa Maria del Plata S.A., the Company pledged 2,460,041 shares
              of its interest in that company to secure the balance owed until
it is fully paid.                                 

    -     As indicated in Note 19 e) to the June 30, 2002 consolidated
            financial statements, the Company has assigned in trust, under
             the terms of Law 24.441, in favor of the Trustee (ABN AMRO BANK
 N.V.) all the shares it owns in Palermo Invest S.A.

NOTE 14: NEGOTIABLE OBLIGATIONS CONVERTIBLE                                     

On March 8, 2002, the Ordinary and Extraordinary Meeting of   
Shareholders resolved:                                        

         a)    Approving the issuance of Negotiable Obligations Convertible into
              Ordinary Shares of the company ("ONC") for up to a face value of
         US$100,000,000 (one hundred million pesos), for a term of 5
            (five) years, at a fixed interest rate of 6% to 12% per annum,
payable half-yearly in arrears.                   

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NOTE 14: (Continued)                                                            

        b)    Approving a subscription option for the ONC holders to subscribe
               ordinary shares of the company at 1 (one) share per $1 (one peso)
             of ONC face value, paying in cash $1(pesos one) as subscription
           price, during 15 (fifteen) days after the conversion term has
    expired, including the corresponding capital increase.

       c)    Suppressing the preferential subscription and accretion rights,
             or reducing the term to exercise the preference, as provided by
               section 12 of the Negotiable Obligations Law and other applicable
regulations.                                      

      d)    Amending article nine (9) of the bylaws to partially adapt its
             contents to the market circumstances arising from the amendment
             approved, by replacing 1) the 20% percentage referred to in the
            amendment to the bylaws, by the percentage indicated in Decree
              677/01, i.e., 35%; and 2) eliminating the negotiable obligations
            or other convertible debt securities, as well as the warrants,
           from the calculation mentioned in Article Nine of the Bylaws.

     As of the date of the present financial statements, this Negotiable
       Obligations Convertible into Ordinary Shares were pending of approval
from the respective control authorities.                      

NOTE 15: SUBSEQUENT EVENTS                                                      

        Issue of Negotiable Obligations Convertible into shares by our related
company Alto Palermo S.A. ("APSA")                            

      On August 20, 2002, APSA ended its subscription period for the first
    branch for up to US$ 50 million of bonds convertible into ordinary
        shares of APSA of a Ps.0.1 nominal value each. In this sense, IRSA has
        subscribed a total amount of US$ 27.2 million of the convertible notes
  of APSA, by using loan agreements existing at that date and cash
contributions.                                                

       Barter - exchange of shares in Argentine Realty S.A. ("ARSA"), Buenos
         Aires Realty S.A.("BARSA") and Buenos Aires Trade & Finance Center S.A.
("BAT&FCSA")                                                  

       On August 16, 2002, the Company and RAGHSA S.A. agreed the following:
      i) the redestribution of the 5M site in Antiguo Puerto Madero of the
         City of Buenos Aires, ii) the division and distribution of the cost and
        contruction commitments for the sites assumed with Corporacion Antiguo
Puerto Madero S.A.(CAPM), iii) the adjustment of the remaining
         commitments and obligations also assumed with CAPM and iv) the exchange
        of shares issued by the mentioned companies owning the plots making up
the 5M site, ARSA, BARSA y BAT&FCSA , respectively.           

    As a result of this distribution the Company now holds 100% of the
        capital stock of BAT&FCSA, while our 50% holding in ARSA and BARSA was
transferred to RAGHSA.                                        

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FIXED ASSETS
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001

 In thousands of pesos

                                                                      SCHEDULE A

                                                        [Enlarge/Download Table]

==================================================================================                                    

                               Value at    Increases    Deductions                                                    
            Items              beginning      and          and       Value as of                                      
                                of year    transfers    Transfers       end of                                        
                                                           and           Year                                         
                                                        writedown                                                     
                                                            of                                                        
                                                       inventories                                                    
                                                           (2)                                                        
----------------------------------------------------------------------------------                                    
                                                                                                                      
Facilities                            61            -         (61)              -                                     
Furniture and fixtures             1,344            2            -          1,346                                     
Computer equipment                 3,473          140            -          3,613                                     
Leasehold improvements             4,863          162            -          5,025                                     

Real Estate:                                                                                                          
------------                                                                                                          
Alsina  934                        1,580            -            -          1,580                                     
Av. De Mayo 595                    6,532            -      (1,561)          4,971                                     
Av. Madero 942                     5,847            -        (958)          4,889                                     
Constitucion 1111                  6,383            -      (5,862)            521                                     
Costeros Dique IV                  2,425       18,345      (4,582)         16,188                                     
Dique 2 M10 (1I) Edif. A          18,910            -      (1,959)         16,951                                     
Dique 2 M10 (1I) Edif. C           5,475            -        (524)          4,951                                     
Hotel Piscis - Purchase                -          518            -            518                                     
advance                                                                                                               
Laminar Plaza                     29,961            -      (3,312)         26,649                                     
Libertador 498                    52,921           17     (14,114)         38,824                                     
Libertador 602                     3,107            -        (558)          2,549                                     
Madero 1020                       20,248            -      (9,807)         10,441                                     
Maipu 1300                        46,959          101      (5,022)         42,038                                     
Puerto Madero Dock 5               2,393            -      (2,393)              -                                     
Reconquista 823                   21,992            -      (3,134)         18,858                                     
Rivadavia 2243                     8,339            -      (8,339)              -                                     
Rivadavia 2768                       352            -        (352)              -                                     
Av. Santa Fe 1588                  8,341            -      (8,341)              -                                     
Sarmiento 517                        583            -        (315)            268                                     
Suipacha 652                      15,139            -      (3,350)         11,789                                     
                              ----------------------------------------------------                                    
TOTAL AS OF JUNE 31, 2002        267,228       19,285      (74,544)       211,969                                     
                              ====================================================                                    
TOTAL AS OF JUNE 31, 2001        286,705        4,349      (23,826)       267,228                                     
==================================================================================                                    


======================================================================================================================
                                                       Depreciation                                                   
                             -----------------------------------------------------------------                        
                                                        For the year                                                  
                                           ---------------------------------------                                    
                                            Deductions                                                                
                                                And                                               Net     Net         
            Items             Accumulated    Transfers       Rate        Amount   Accumulated  carrying   carrying    
                                 as of                         %          (1)     as of year   Value as   value as    
                             beginning of                                             end         of         of       
                                 year                                                          June 30,   June        
                                                                                                 2002     30, 2001    

----------------------------------------------------------------------------------------------------------------------
                                                                                                                      
Facilities                              -            -        10               -           -           -          61  
Furniture and fixtures              1,235            -        20             109       1,344           2         109  
Computer equipment                  2,985            9       33,33           407       3,401         212         488  
Leasehold improvements              2,384            -        10             580       2,964       2,061       2,479  

Real Estate:                                                                                                          
------------                                                                                                          
Alsina  934                           209            -         2              24         233       1,347       1,371  
Av. De Mayo 595                       869            -         2             364       1,233       3,738       5,663  
Av. Madero 942                        646            -         2              96         742       4,147       5,201  
Constitucion 1111                     924        (908)         2             133         149         372       5,459  
Costeros Dique IV                       -            -         2             311         311      15,877       2,425  
Dique 2 M10 (1I) Edif. A              280            -         2             425         705      16,246      18,631  
Dique 2 M10 (1I) Edif. C                -            -         2               -           -       4,951       5,475  
Hotel Piscis - Purchase                 -            -         2               -           -         518           -  
advance                                                                                                               
Laminar Plaza                         828            -         2             478       1,306      25,343      29,133  
Libertador 498                      4,758        (513)         2             835       5,080      33,744      48,163  
Libertador 602                        253            -         2              48         301       2,248       2,854  
Madero 1020                         1,787        (693)         2             322       1,416       9,025      18,460  
Maipu 1300                          4,352            -         2             764       5,116      36,922      42,607  
Puerto Madero Dock 5                  244        (308)         2              64           -           -       2,149  
Reconquista 823                     2,699            -         2             352       3,051      15,807      19,293  
Rivadavia 2243                      1,000      (1,071)         2              71           -           -       7,339  
Rivadavia 2768                         51         (55)         2               4           -           -         301  
Av. Santa Fe 1588                     884        (917)         2              33           -           -       7,457  
Sarmiento 517                          52         (21)         2               8          39         229         531  
Suipacha 652                        2,113            -         2             655       2,768       9,021      13,026  
                            ------------------------------------------------------------------------------------------
TOTAL AS OF JUNE 31, 2002          28,553       (4,477)        -           6,083      30,159     181,810           -  
                            ==========================================================================================
TOTAL AS OF JUNE 31, 2001          24,852       (2,334)        -           6,035      28,553           -     238,675  
======================================================================================================================

(1)  The accounting application of the depreciation for the year is set forth   
in Schedule H.                                                        
(2)  See coments in Note 2.c.                                                   

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 INTANGIBLE ASSETS
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001
 In thousands of pesos

                                                                      SCHEDULE B

                                                        [Enlarge/Download Table]

========================================================================================================================
                                                           Values of origin                            Amortization     
                                         -------------------------------------------------------------------------------
                                          Balances                                            Accumulated               
                                            as of                                Balances as     as of                  
                                          beginning                               of end of    beginning                
                 Items                     of year     Additions    Deductions       year       of year     Additions   
------------------------------------------------------------------------------------------------------------------------
                                                                                                                        
ON 1999 expenses                              2,623             -        (2,623)           -        2,623            -  
ON 2003 expenses                              7,181             -        (7,181)           -        7,181            -  
Development property expenses                   477           156          (241)         392            -          143  
Bank loan expenses                           10,495         2,694              -      13,189        8,024            -  
Exchange expenses                             2,523           339              -       2,862        1,293            -  
                                         -------------------------------------------------------------------------------
TOTAL AS OF  JUNE 30, 2002                   23,299         3,189       (10,045)      16,443       19,121          143  
                                         -------------------------------------------------------------------------------
TOTAL AS OF JUNE 30, 2001                    19,406        12,549        (8,656)      23,299       13,251        2,689  
========================================================================================================================

==================================================================================================                      
                                             Amortization                 Net carrying value as of                      
                                  ----------------------------------------------------------------                      
                                                            Accumulated                                                 
                                                  Amount     as of end    June 30,     June 30,                         
                 Items               Deductions      (1)      of year       2002         2001                           
-------------------------------------------------------------------------------------=============                      
                                                                                                                        
ON 1999 expenses                         (2,623)         -           -            -            -                        
ON 2003 expenses                         (7,181)         -           -            -            -                        
Development property expenses                  -        13         156          236          477                        
Bank loan expenses                             -     4,915      12,939          250        2,471                        
Exchange expenses                              -         -       1,293        1,569        1,230                        
                                  ----------------------------------------------------------------                      
TOTAL AS OF  JUNE 30, 2002               (9,804)     4,928      14,388        2,055            -                        
                                  ----------------------------------------------------------------                      
TOTAL AS OF JUNE 30, 2001                 (2,684)    5,865      19,121            -        4,178                        
==================================================================================================                      

(1)  The accounting application of the amortization for the year is set forth in
Schedule H.                                                           

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

SHARES AND OTHER SECURITIES ISSUED IN SERIES
 INTEREST IN OTHER COMPANIES
 Balance Sheets as of June 30, 2002 and 2001
 In thousands of pesos

                                                                      SCHEDULE C

                                                        [Enlarge/Download Table]

========================================================================================================            

                                                                                  Value as    Value as              
                                                                      Listing     of June     of June               
Issuer and types of securities      Class      P.V.      Amount         value     30, 2002    30, 2001              
--------------------------------------------------------------------------------------------------------            
                                                                                                                    
CURRENT INVESTMENTS                                                                                                 
APSA 2005 bonds                         U$S       0.001     700,000           -           -       1,414             
Telecom Argentina S.A                    $        0.001     537,239           -           -      17,351             
Perez Companc S.A.                       $        0.001   1,638,171           -           -         788             
Bocon PRO 1                              $        0.001  13,174,419      0.0003           -      12,817             
Banco Hipotecario S.A.                   $        0.001   1,093,445      0.0029       1,956       1,009             
                                     -------------------------------------------------------------------            
Total current investments as of                                                       1,956           -             
June 30, 2002                                                                                                       
                                     -------------------------------------------------------------------            
Total current investments as of                                                                  33,379             
June 30, 2001                                                                                                       
========================================================================================================            

====================================================================================================================
                                                      Issuer's information (1)                                      
                                     ------------------------------------------------------------                   
                                                            Last financial statement                                
                                                   ----------------------------------------------                   
                                                                                                           (1)      
                                                               Capital   Income(loss)                  Interest in  
                                        Main                    stock     for the      Shareholders'     capital    
Issuer and types of securities       Activity      Date     (par value)     year        equity            stock     
--------------------------------------------------------------------------------------------------------------------
                                                                                                                    
CURRENT INVESTMENTS                                                                                                 
APSA 2005 bonds                               -           -           -           -           -            -        
Telecom Argentina S.A                         -           -           -           -           -            -        
Perez Companc S.A.                                                                                                  
Bocon PRO 1                                                                                                         
Banco Hipotecario S.A.                        -           -           -           -           -            -        
                                    --------------------------------------------------------------------------------
Total current investments as of                                                                                     
June 30, 2002                                                                                                       
                                    --------------------------------------------------------------------------------
Total current investments as of                                                                                     
June 30, 2001                                                                                                       
====================================================================================================================

(1)  Not inform because the equity interest is less than 5%.                    

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

SHARES AND OTHER SECURITIES ISSUED IN SERIES
 INTEREST IN OTHER COMPANIES
 Balance Sheets as of June 30, 2002 and 2001
 In thousands of pesos

                                                          SCHEDULE C (Continued)

                                                        [Enlarge/Download Table]

=========================================================================================================                           
                                                                                      Value      Value                              
                                                                                    Recorded   Recorded                             
                                                                          Listing   at June    at June                              
  Issuer and types of securities           Class       P.V.      Amount     value    30, 2002  30, 2001                             
---------------------------------------------------------------------------------------------------------                           
                                                                                                                                    
NON-CURRENT INVESTMENTS                                                                                                             

Abril S.A.                                Common 1      5,000      1,320         -   (17,883)  (15,254)                             
                                            vote            -          -         -     22,251    21,346                             
                                          Irrevoc.                                                                                  
                                          Contrib.                                                                                  

IRSA International Ltd.                   Common 1      0.001          -         -          -   451,477                             
                                            vote                                                                                    
Pereiraola S.A.                           Common 1      0.001     50,000         -      6,941     7,058                             
                                            vote                                                                                    
                                          Irrevoc.          -          -         -        968       859                             
                                          Contrib.                                                                                  
Baldovinos S.A.                           Common 1      0.001      6,000         -     (4,711)   (3,562)                            
                                            vote                                                                                    
                                          Irrevoc.          -          -         -     10,290    10,239                             
                                          Contrib.                                                                                  
Home Financing S.A.                       Common 1      0.001     11,999         -          -      (648)                            
                                            vote                                                                                    
                                          Irrevoc.          -          -         -          -       929                             
                                          Contrib.                                                                                  
Palermo Invest S.A.                       Common 1      0.001  76,949,667        -    120,710   187,277                             
                                            vote                                                                                    
Inversora del Puerto S.A.                 Common 1      0.001          -         -          -     1,174                             
                                            vote                                                                                    
Hoteles Argentinos S.A.                   Common 1      0.001  7,309,273         -    (5,771)    15,542                             
                                            vote                                                                                    
                                          Irrevoc.          -          -         -      3,142         -                             
                                          Contrib.                                                                                  
Alto Palermo S.A. (ex SAMAP)              Common 1      0,001  64,559,510        -    307,246    89,371                             
                                            vote                                                                                    
Buenos Aires Realty S.A.                  Common 1      0.001      6,000         -        118        33                             
                                            vote                                                                                    
                                          Irrevoc.          -          -         -      4,553     3,807                             
                                          Contrib.                                                                                  
Buenos Aires Trade and Finance            Common 1      0.001      6,000         -      2,288        18                             
Center S.A.                                 vote                                                                                    
                                          Irrevoc.          -          -         -      3,878     3,238                             
                                          Contrib.                                                                                  
Argentine Realty S.A.                     Common 1      0.001      6,000         -      (181)        16                             
                                            vote                                                                                    
                                          Irrevoc.          -          -         -      4,740     3,961                             
                                          Contrib.                                                                                  
Llao - Llao Resort S.A                    Common 1      0.001  5,878,940         -      7,659     4,018                             
                                            vote                                                                                    
                                          Irrevoc.          -          -         -      2,086     1,086                             
                                          Contrib.                                                                                  
Banco de Credito y Securitizacion S.A.    Common 1      0.001  3,187,500         -      6,236     9,781                             
                                            vote                                                                                    
Alto Invest S.A.                          Common 1      0.001        960         -         10         -                             
                                            vote            -          -         -        164         -                             
                                          Irrevoc.                                                                                  
                                          Contrib.                                                                                  

Ritelco S.A.                              Common 1      0.001  66,970,394        -     36,656         -                             
                                            vote                                                                                    
                                       ------------------------------------------------------------------                           
Total as of June 30, 2002                                                             511,390         -                             
                                       ------------------------------------------------------------------                           
Total as of June 30, 2001                                                                   -   791,766                             
=========================================================================================================                           


====================================================================================================================================
                                                                    Issuer's information                                            
                                         -------------------------------------------------------------------------                  
                                                                               Last financial statement                             
                                                                   -----------------------------------------------                  

                                                                                 Capital     Income                                 
                                                                                  ftock       (loss)                                
                                               Main                               (Par       for the   Shareholders'  Interest in   
Issuer and types of securities               Activity                 Date        value)      year        equity     Capital Stock  
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                    
NON-CURRENT INVESTMENTS                                                                                                             

Abril S.A.                                 Building, development     06.30.2002   13,200     (6,741)      49,778            50%     
                                           and administration of                                                                    
                                                 country club                                                                       

IRSA International Ltd.                         Investment           06.30.2002        -           -           1           100%     

Pereiraola S.A.                          Real estate and financing   06.30.2002      100       (234)       2,375            50%     

Baldovinos S.A.                          Real estate and building    06.30.2002       12     (1,800)      10,494            50%     

Home Financing S.A.                              Mortgages           06.30.2002                                                     

Palermo Invest S.A.                             Investments          06.30.2002   78,251      11,215     181,273         66,67%     

Inversora del Puerto S.A.                   Purchase, sales and                                                                     
                                         explotation of properties                                                                  

Hoteles Argentinos S.A.                      Hotel Libertador        06.30.2002    9,887    (26,543)       5,744         79,99%     
                                                exploitation                                                                        

Alto Palermo S.A. (ex SAMAP)              Real estate investments    06.30.2002   70,000    (42,403)     601,207         10,37%     

Buenos Aires Realty S.A.                  Real estate investments    06.30.2002       12       5,303      14,432            50%     

Buenos Aires Trade and Finance                                                                                                      
  Center S.A.                             Real estate investments    06.30.2002       12       4,540      12,316            50%     

Argentine Realty S.A.                     Real estate investments    06.30.2002       12       5,572      15,077            50%     

Llao - Llao Resort S.A                        Hotel Llao-Llao        06.30.2002   11,757       7,299      18,663            50%     
                                                exploitation                                                                        

Banco de Credito y Securitizacion S.A.            Banking            06.30.2002   62,500       4,032      67,349          5,10%     

Alto Invest S.A.                            Electronic Commerce      06.30.2002       12     (1,032)         697             8%     

Ritelco S.A.                                    Investments          06.30.2002   66,970   (253,174)      36,656                    
                                         -------------------------------------------------------------------------------------------
Total as of June 30, 2002                                                                                                           
                                         -------------------------------------------------------------------------------------------
Total as of June 30, 2001                                                                                                           
====================================================================================================================================

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 OTHER INVESTMENTS
 Balance Sheets as of June 31, 2002 and 2001
 In thousands of pesos

                                                                      SCHEDULE D

                                                        [Enlarge/Download Table]

=============================================================================================================
                                                                      Value as of June    Value as of June   
                               Items                                      30, 2002            30, 2001       
=============================================================================================================
                                                                                                             
CURRENT INVESTMENTS                                                                                          

Time deposits                                                                        158                 374 
Mutual funds                                                                       7,383               1,195 
                                                                    -----------------------------------------
Total current investments as of June 30, 2002                                      7,541                   - 
                                                                    =========================================
Total current investments as of June 30, 2001                                          -               1,569 
                                                                    =========================================
NON-CURRENT INVESTMENTS Undeveloped parcels of land:                                                         

 Santa Maria del Plata                                                           103,213             110,244 
 Torres Jardin IV                                                                  1,985               2,698 
                                                                    -----------------------------------------
 Subtotal                                                                        105,198             112,942 
                                                                    -----------------------------------------
IRSA I Trust Exhangeable Certificates Class A                                        629                   - 
IRSA I Trust Exhangeable Certificates Class B                                        918                   - 
IRSA I Trust Exchangeable Certificates Class C                                     1,472                   - 
IRSA I Trust Exchangeable Certificates Class D                                     5,143                   - 
                                                                    -----------------------------------------
Subtotal                                                                           8,162                   - 
                                                                    -----------------------------------------
Art work                                                                              33                  33 
                                                                    -----------------------------------------
Total non-current investments as of June 30, 2002                                113,393                   - 
                                                                    =========================================
Total non-current investments as of June 30, 2001                                      -             112,975 
=============================================================================================================

As of June 30, 2002 the non-current investments, Santa Maria del Plata and Torre
Jardin IV, include the provision for impairment as mentioned in Note 2.a.3      

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 ALLOWANCES AND PROVISIONS
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001
 In thousands of pesos

                                                                      SCHEDULE E

                                                        [Enlarge/Download Table]

====================================================================================================================================

                                                        Balances as of                               Carrying value   Carrying value
                                                         beginning of                                    as of            as of     
                            Items                            year         Increases (1)   Decreases    June 30, 2002   June 31, 2001
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                    
DEDUCTED FROM ASSETS:                                                                                                               
  Allowance for doubful accounts                                1,1678           353         (958)            1,073            1,678
  Provision for impairment of inventory                              -        14,472        (4,262)          10,210                -
  Provision for impairment of fixed assets                           -        37,599              -          37,599                -
  Provision for impairment of undeveloped plots of land              -         8,301              -           8,301                -

FROM LIABILITIES:                                                                                                                   

  Provisions for lawsuits                                           10           314         (120)              204               10
  Provisions for discounts                                          22             -          (11)               11               22
                                                       -----------------------------------------------------------------------------
TOTAL AS OF JUNE 30, 2002                                        1,710        61,039       (5,351)           57,398                -
                                                       -----------------------------------------------------------------------------
TOTAL AS OF JUNE 30, 2001                                          755         1,153         (198)                -            1,710
====================================================================================================================================

(1) The increase in the Allowance for doubful accounts is set forth in Schedule 
H, the increase of the provision for impairment of inventory, fixed asset and   
undeveloped plots of land are included in Results for operations and holdings of
real estate assets for a total amount of $ 60,372 (corresponding $ 56.110 as    
mentioned in Note 2.m and $ 4,262 as indicated in Schedule F) and the increase  
in Provision for lawsuits is set forth in Maintenance of building in Cost of    
properties sold of Schedule H.                                                  

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

COST OF SALES, LEASES AND SERVICES
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001

 In thousands of pesos

                                                                      SCHEDULE F

                                                        [Enlarge/Download Table]

=================================================================================================================
                                                                          June 30, 2002        June 30, 2001     
                                                                       ------------------------------------------
                                                                                                                 
I. COST OF SALES                                                                                                 

Stock as of beginning of year                                                      32.994                50,499  
Plus (less):                                                                                                     
Purchases for the year                                                                 91                   383  
Expenses (Schedule H)                                                               1,204                 1,792  
Transfers to fixed assets                                                               -                   (10) 
Transfers from fixed assets                                                        32,399                19,537  
Less:                                                                                                            
Reclassification of inventories sold                                                   80                   608  
Reclassification from expenses for property sold to intangible assets                   -                  (595) 
Stock as of end of year                                                           (31,516)              (32,994) 
                                                                       ------------------------------------------
Subtotal                                                                           35,252                39,220  
                                                                       ------------------------------------------
Plus                                                                                                             

Cost of sales - Abril S.A.                                                          3,676                 8,713  
Results from holding of real estate assets (1)                                    (14,472)               (3,723) 
                                                                       ------------------------------------------
       COST OF PROPERTIES SOLD                                                     24,456                44,210  
                                                                       ------------------------------------------
II. COST OF LEASES                                                                                               

Expenses (Schedule H)                                                               7,653                 6,839  
                                                                       ------------------------------------------
       COST OF PROPERTIES LEASED                                                    7,653                 6,839  
                                                                       ------------------------------------------
III. COST OF FEES FOR SERVICES                                                                                   

Expenses (Schedule H)                                                               1,586                 3,441  
                                                                       ------------------------------------------
       COSTO OF FEES FOR SERVICES                                                   1,586                 3,441  
                                                                       ------------------------------------------
       TOTAL COSTS                                                                 33,695                54,490  
=================================================================================================================

(1) Includes the total amount of $ 10,210 for imapirment provision in accordance
with mentioned in Note 2.b. and $ 4,262 corresponds to provision generated      
during the year for inventories that have been sold as of June 30, 2002.        

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 FOREIGN CURRENCY ASSETS AND LIABILITIES
 Balance Sheets as of June 30, 2002 and 2001

 In thousands of pesos

                                                                      SCHEDULE G

                                                        [Enlarge/Download Table]

===================================================================================================================================

                                                                           Prevailing exchange     Total as of     Total as of     
                     Items                         Class       Amount              rate           June 30, 2002   June 30, 2001    
-----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                   
ASSETS                                                                                                                             
CURRENT ASSETS                                                                                                                     
Cash and banks:                                                                                                                    
    Cash                                            U$S           38,808    0.0037       (1)                 144                6  
    Banks                                           U$S           28,822    0.0037       (1)                 107            4,223  
    Savings accounts                                U$S           40,472    0.0037       (1)                 150              395  
    Checks to be deposited                          U$S                -    0.0037       (1)                   -               29  
Investments:                                                                                                                       
    APSA 2005 bond                                  U$S                -    0.0037       (1)                   -            1,414  
    Patriotic bond                                  U$S                -    0.0037       (1)                   -                -  
    Time deposits                                   U$S                -    0.0037       (1)                   -              374  
    Mutual Funds                                    U$S        1,985,022    0.0037       (1)               7,345              603  
Mortgages and leases receivables                    U$S                -    0.0037       (1)                   -           30,423  
Other receivables:                                                                                                                 
    Intercompany                                    U$S        8,142,865    0.0038       (1)              30,129               10  
    Services to be billed                           U$S                -    0.0037       (1)                   -              364  
    Operations pendings to settlement               U$S                -    0.0037       (1)                   -              939  
    Personnel loans and prepayments                 U$S                -    0.0037       (1)                   -              651  
    Total Current Assets                                      10,235,989                                  74,521           37,875  
                                                          --------------                       ----------------------------------  
NON-CURRENT ASSETS                                                                                                                 
Mortgages receivable                                U$S                -    0.0037       (1)                   -           35,105  
Other receivables:                                                                                                                 
    Intercompany                                    U$S        9,643,556    0.0038       (1)              36,646                -  
    Guarantee deposits                              U$S                -    0.0037       (1)                   -               74  
    Personnel loans and prepayments                 U$S                -    0.0037       (1)                   -            2,541  
Fixed Assets                                        U$S          140,000    0.0037       (1)                 518                -  
Investments:                                                           -                                                           
IRSA                                                                                                                               
    International Ltd.:                                                                                                            
        Shares                                      U$S                -    0.0037       (1)                   -          451,477  
    Total Non-current Assets                        U$S        9,783,556                                  37,164          489,198  
                                                            --------------                       ----------------------------------
TOTAL ASSETS AS OF JUNE 30, 2002                    U$S       20,019,545                                  75,039                -  
                                                            --------------                       ----------------------------------
TOTAL ASSETS AS OF JUNE 30, 2001                    U$S      528,632,674                                       -          528,629  
                                                            --------------                       ----------------------------------
LIABILITIES                                                                                                                        
CURRENT LIABILITIES                                                                                                                
Accounts payable                                    U$S                -    0.0038       (1)                   -               63  
Customer advances                                   U$S                -    0.0038       (1)                   -              882  
Taxes payable                                       U$S        1,665,402    0.0038       (1)               6,329                -  
Short and long term debt                            U$S      136,425,994    0.0038       (1)             518,419          325,422  
Other liabilities:                                                                                                                 
    Debt for purchase of shares                     U$S                -    0.0038       (1)                   -            1,602  
    Intercompany                                    U$S                -    0.0038       (1)                   -            1,768  
    Guarantee deposits                              U$S                -    0.0038       (1)                   -              876  
    Provisions                                      U$S                -    0.0038       (1)                   -               22  
    Collections on behalf of third parties          U$S                -    0.0038       (1)                   -              188  
                                                            --------------                       ----------------------------------
    Total Current Liabilities                       U$S      138,091,396                                 524,748          330,823  
                                                            --------------                       ----------------------------------
NON-CURRENT LIABILITIES                                                                                                            
Accounts payable                                    U$S                -    0.0038       (1)                   -              374  
Short and long term debt                            U$S                -    0.0038       (1)                   -                -  
Customer advances                                   U$S                -    0.0038       (1)                   -              360  
Other liabilities:                                                                                                                 
    Debt for purchase of shares                     U$S                -    0.0038       (1)                   -            2,836  
    Guarantee deposits                              U$S                -    0.0038       (1)                   -            2,770  
    Directors' deposits                             U$S                -    0.0038       (1)                   -               16  
                                                            --------------                       ----------------------------------
    Total Non-current Liabilities                   U$S                -                                       -            6,356  
                                                            --------------                       ----------------------------------
TOTAL LIABILITIES AS OF JUNE 30, 2002               U$S      138,091,396                                 524,748                -  
                                                            --------------                       ----------------------------------
TOTAL LIABILITIES AS OF JUNE 30, 2001               U$S      337,182,301                                       -          337,179  
===================================================================================================================================

(1) Official rate of exchange quoted by Banco Nacion at June 30, 2002.          

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

INFORMATION REQUIRED BY LAW 19,550, SECTION 64, PARAGRAPH B)
For the years beginning on
 July 1, 2001 and 2000
and ended June 30, 2002 and 2001
 In thousands of pesos

                                                                      SCHEDULE H

                                                        [Enlarge/Download Table]

============================================================================================================        
                                                              Cost of                                               
                                           Total as of       properties        Cost of        Cost of fees          
                  Items                   June 30, 2002        leased      properties sold    for services          
------------------------------------------------------------------------------------------------------------        
                                                                                                                    
 Directors' fees                                   1,037                -                -                -         
 Fees and payments for                             2,219                -                -                -         
 services                                                                                                           
 Salaries, bonuses and social security             6,411                -                -                -         
 charges                                                                                                            
 Other expenses of personnel                         310                -                                           
 administration                                                                                                     
 Depreciation and amortization                    11,011            4,987                -                -         
 Maintenance of buildings                          4,194            2,666            1,204                -         
 Utilities and postage                                28                -                -                -         
 Travel expenses                                     121                -                -                -         
 Advertising and promotion                           859                -                -                -         
 Fees and expenses for property sold                 999                -                -                -         
 Local transportation and stationery                 138                -                -                -         
 Taxes, rates and assessments                         30                -                -                -         
 Subscriptions and dues                              223                -                -                -         
 Interest and indexing adjustments                40,086                -                -                -         
 Bank charges                                        436                -                -                -         
 Safety box and stockbroking charges                 181                -                -                -         
 Doubtful                                            353                -                -                -         
 accounts                                                                                                           
 Insurance                                             4                -                -                -         
 Security                                              8                -                -                -         
 Courses                                              59                -                -                -         
 Lawsuits                                            277                -                -                -         
 Results of  fideicomiso                           1,176                -                -                -         
 Rents                                               451                -                -                -         
 Other                                             5,104                -                -            1,586         
                                         -------------------------------------------------------------------        
 Total as of June 30, 2002                        75,625            7,653            1,204            1,586         
                                         ===================================================================        
 Total as of June 30, 2001                             -            6,839            1,792            3,441         
============================================================================================================        


====================================================================================================================
                                                                            Expenses                                
                                                           -------------------------------------------              
                                                                                                       Total as of  
                                           Cost of hotel                                                June 30,    
                  Items                       activity     Administration   Selling       Financing       2001      
--------------------------------------------------------------------------------------------------------------------
                                                                                                                    
 Directors' fees                                        -         1,037              -             -         1,410  
 Fees and payments for                                  -         2,219              -             -         3,609  
 services                                                                                                           
 Salaries, bonuses and social security                  -         6,411              -             -         9,748  
 charges                                                                                                            
 Other expenses of personnel                                        310              -             -           108  
 administration                                                                                                     
 Depreciation and amortization                          -         1,096              -         4,928        11,900  
 Maintenance of buildings                               -           324              -             -         5,520  
 Utilities and postage                                  -            28              -             -            43  
 Travel expenses                                        -           121              -             -           168  
 Advertising and promotion                              -            74            785             -           644  
 Fees and expenses for property sold                    -             -            999             -         3,462  
 Local transportation and stationery                    -           138              -             -           317  
 Taxes, rates and assessments                           -            30              -             -            18  
 Subscriptions and dues                                 -           223              -             -           200  
 Interest and indexing adjustments                      -             -              -        40,086        54,326  
 Bank charges                                           -             -              -           436           436  
 Safety box and stockbroking charges                    -           138              -            43           356  
 Doubtful                                               -             -            353             -           364  
 accounts                                                                                                           
 Insurance                                              -             4              -             -            27  
 Security                                               -             8              -             -            90  
 Courses                                                -            59              -             -           153  
 Lawsuits                                               -           277              -             -             -  
 Results of  fideicomiso                                -             -              -         1,176             -  
 Rents                                                  -           451              -             -         1,049  
 Other                                                  -           294              -         3,134         3,037  
                                         ---------------------------------------------------------------------------
 Total as of June 30, 2002                              -        13,242          2,137        49,803             -  
                                         ===========================================================================
 Total as of June 30, 2001                              -        19,681          4,380        60,852        96,985  
====================================================================================================================

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 BREAKDOWN BY MATURITY DATE OF RECEIVABLES AND LIABILITIES
AS OF JUNE 30, 2002 AND 2001

 In thousands of pesos

                                                                      SCHEDULE I

                                                        [Enlarge/Download Table]

---------------------------------------------------------------------------------------------------
                                                                    WITH MATURITY DATE             

                               --------------------------------------------------------------------
                                                                           TO DUE                  
                                        -----------------------------------------------------------
                                        UP TO    FROM 3   FROM 6  FROM 9   FROM 1   FROM 2  FROM 3 
                       WITHOUT FALLING    3       TO 6     TO 9   TO 12     TO 2     TO 3    TO 4  
                        TERM     DUE    MONTHS   MONTHS   MONTHS  MONTHS   YEARS    YEARS   YEARS  
---------------------------------------------------------------------------------------------------
                                                                                                   

2002                                                                                               
Assets                                                                                             
  Investments            7,383       -        -       -      158        -     526    2,815   2,605 
  Receivables           77,377       -   56,189     828      636      628   2,262    2,211   2,188 
Liabilities                                                                                        
  Loans                      -       -  521,170       -        -        -       -        -       - 
  Other liabilities        503      33   16,816   1,714       67      265   1,018      211     214 

2001                                                                                               
Assets                                                                                             
  Investments           34,576       -      125      92       84       71       -        -       - 
  Receivables                -   6,602   22,851   8,371    2,764    4,613  12,954   14,392   7,516 
Liabilities                                                                                        
  Loans                      -       -  103,678  86,466        -  156,496       -        -       - 
                       ----------------------------------------------------------------------------
  Other liabilities          -      70    8,596   1,784    3,406      244   2,927    2,821     213 
---------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------               
                            WITH MATURITY DATE                   INTEREST                          
                       ---------------------------         -------------------------               
                           TO DUE                                      ACCRUED                     
                       -------------------                         -----------------               
                         FROM 4           TOTAL                                                    
                         YEARS   TOTAL A  WITH               NO     FIXED   VARIABLE               
                           ON     VENCER   TERM   TOTAL   ACRCRUED   TERM    TERM                  
------------------------------------------------------------------------------------               
                                                                                                   

2002                                                                                               
Assets                                                                                             
  Investments              2,216   8,320    8,320  15,703        -   3,177   12,526                
  Receivables              6,172  71,114   71,114 148,491   68,717  79,774        -                
Liabilities                                                                                        
  Loans                        - 521,170  521,170 521,170        - 207,212  313,958                
  Other liabilities            8  20,313   20,346  20,849   20,124     725        -                

2001                                                                                               
Assets                                                                                             
  Investments                  -     372      372  34,948   34,576     372        -                
  Receivables             25,624  99,085  105,687 105,687   45,105  60,582        -                
Liabilities                                                                                        
  Loans                        - 346,640  346,640 346,640        - 155,682  190,958                
                       -------------------------------------------------------------               
  Other liabilities          395  20,386   20,456  20,456   15,581   4,875        -                
------------------------------------------------------------------------------------               

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 INFORMATION REQUIRED BY SECTION 68 OF THE

 BUENOS AIRES STOCK EXCHANGE REGULATIONS
 BALANCE SHEET AS OF JUNE 30, 2002

Stated in thousands of pesos

1.     None                                                                     

2.     None                                                                     

3.     Additional information on assets and liabilities                         

                                                        [Enlarge/Download Table]

================================================================================================ 
                                           FALLING DUE              WITH NO                      
                                                                 MATURITY DATE                   
                                 --------------------------------------------------------------- 
            CONCEPT                  31.3.02         31.5.02        CURRENT         30.9.02      
------------------------------------------------------------------------------------------------ 
                                                                                                 
RECEIVABLES                                                                                      
Receivables for sale                        -               -             737          7,136     
Receivable for the sale of                                                                       
properties                                  -               -               -              -     
Other receivables                           -               -           1,842         49,053     
                                 --------------------------------------------------------------- 
Total                                       -               -           2,579         56,189     

LIABILITIES                                                                                      
Customer advances                           -               -               -            186     
Taxes payables                              -               -               -          8,873     
Trade accounts payable                      -               -               -          6,350     
Other liabilities                          33               -               -          1,068     
Loans                                       -         311,206               -        209,964     
Salaries and social securities                                                                   
payables                                    -               -               -            339     
                                 =============================================================== 
Total                                      33         311,206               -        226,780     
================================================================================================ 

=================================================================================================
                                       TO DUE (POINT 3 C)                                        

                                 -----------------------------------------------                 
            CONCEPT                 31.12.02         31.3.03        30.6.03          TOTAL       
------------------------------------------------------------------------------------------------ 
                                                                                                 
RECEIVABLES                                                                                      
Receivables for sale                      298             110             103          8,384     
Receivable for the sale of                                                                       
properties                                  -               -               -              -     
Other receivables                         530             526             525         52,476     
                                 --------------------------------------------------------------- 
Total                                     828             636             628         60,860     

LIABILITIES                                                                                      
Customer advances                           -               -               -            186     
Taxes payables                            801               -               -          9,674     
Trade accounts payable                      -               -               -          6,350     
Other liabilities                         913              63             265          2,342     
Loans                                       -               -               -        521,170     
Salaries and social securities                                                                   
payables                                    -               4               -            343     
                                 =============================================================== 
Total                                   1,714              67             265        540,065     
================================================================================================ 

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 INFORMATION REQUIRED BY SECTION 68 OF THE

 BUENOS AIRES STOCK EXCHANGE REGULATIONS
 BALANCE SHEET AS OF JUNE 30, 2002

3.  (Continued)           Stated in thousands of pesos                          

                                                        [Enlarge/Download Table]

============================================================================================================================
                                                                             TO MATURE (POINT 3 C)                          
                                            ================================================================================
                              WITHOUT ANY                                                                                   
                             FIXED DUE DATE                                                                                 
             ITEMS           (NON-CURRENT)     30.9.03  31.12.03  31.3.04   30.6.04   30.9.04   31.12.04  31.3.05   30.6.05 
----------------------------------------------------------------------------------------------------------------------------
                                                                                                                            
RECEIVABLES                                                                                                                 
Receivables for the sale of                                                                                                 
properties                          1,638           -         -        -       160         -         -         -       108  
Other receivables                  73,160           -         -        -     2,102         -         -         -     2,103  
Total                              74,798           -         -        -     2,262         -         -         -     2,211  

LIABILITIES                                                                                                                 

Other liabilities                     503          80       786       32       120        53        34        36        88  
Total                                 503          80       786       32       120        53        34        36        88  
============================================================================================================================

                                                        [Enlarge/Download Table]

===========================================================================================        
                                                   TO MATURE (POINT 3 C)                           
                             --------------------------------------------------------------        

             ITEMS           30.9.05  31.12.05 30.6.06  30.6.07   30.6.08  30.6.09 30.6.10         
-------------------------------------------------------------------------------------------        
                                                                                                   
RECEIVABLES                                                                                        
Receivables for the sale of                                                            31          
properties                         -        -       86       79       30       27                  
Other receivables                  -        -    2,102    2,104    2,107    1,296       -          
Total                              -        -    2,188    2,183    2,137    1,323      31          

LIABILITIES                                                                                        
Other liabilities                 45      169        -        -        -        -       -          
Total                             45      169        -        -        -        -       -          
===========================================================================================        

===================================================================================================
                                                    TO MATURE (POINT 3 C)                          
                            -----------------------------------------------------------------------

             ITEMS           30.6.11  30.6.12  30.6.13  30.6.14  30.9.14  30.6.15  30.6.18 TOTAL   
---------------------------------------------------------------------------------------------------
                                                                                                   
RECEIVABLES                                                                                        
Receivables for the sale of      20       22       26       24        -        7                   
properties                                                                              -   2,258  
Other receivables                 -        -        -        -        -        -      399  85,373  
Total                            20       22       26       24        -        7      399  87,631  

LIABILITIES                                                                                        
Other liabilities                 -        -        -        -        8        -        -   1,954  
Total                             -        -        -        -        8        -        -   1,954  
===================================================================================================

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 INFORMATION REQUIRED BY SECTION 68 OF THE

 BUENOS AIRES STOCK EXCHANGE REGULATIONS
 BALANCE SHEET AS OF JUNE 30, 2002

3.  (Continued)           Stated in thousands of pesos                          

==============================================                                  
ITEMS                 TOTAL                           
----------------------------------------------                                  
RECEIVABLES                                                                     
Receivables for sale                  8,384                                     
Receivables for the sale of                                                     
properties                            2,258                                     
Other receivables                   137,849                                     
===============   
Total                               148,491                                     
===============   

LIABILITIES                                                                     
Customer advances                       186                                     
Taxes payable                         9,674                                     
Trade accounts payable                6,350                                     
Other liabilities                     4,296                                     
Loans                               521,170                                     
Salaries and social                                                             
securities payable                      343                                     
---------------   
Total                               542,019                                     
==============================================                                  

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 INFORMATION REQUIRED BY SECTION 68 OF THE
 BUENOS AIRES STOCK EXCHANGE REGULATIONS
 BALANCE SHEET AS OF JUNE 30, 2002

Stated in thousands of pesos

The classification of receivables and liabilities is as follows:                

4-a.   Breakdown by currency and maturity                                       

                                                        [Enlarge/Download Table]

================================================================================================================
                                               CURRENT                               NON-CURRENT                
                               ---------------------------------------------------------------------------------
                                  LOCAL       FOREIGN                      LOCAL       FOREIGN        TOTAL     
             ITEMS               CURRENCY     CURRENCY   TOTAL CURRENT   CURRENCY     CURRENCY     NON-CURRENT  
----------------------------------------------------------------------------------------------------------------
                                                                                                                
 ACCOUNTS RECEIVABLES                                                                                           
 Receivables                         8,384            -        8,384             -            -             -   
 Mortgages and leases                                                                                           
 receivables                             -            -            -         2,258            -         2,258   
 Other receivables                  22,348       30,129       52,477        48,727       36,646        85,373   
                               ---------------------------------------------------------------------------------
 Total                              30,732       30,129       60,861        50,985       36,646        87,631   
----------------------------------------------------------------------------------------------------------------
 LIABILITIES                                                                                                    
 Customer advances                     186            -          186             -            -             -   
 Taxes payable                       9,674            -        9,674             -            -             -   
 Trade accounts payable              6,350            -        6,350             -            -             -   
 Other liabilities                   2,342            -        2,342         1,954            -         1,954   
 Short and long term debt            2,752      518,419      521,171             -            -             -   
 Salaries and social security                                                                                   
 payable                               343            -          343             -            -             -   
                               ---------------------------------------------------------------------------------
 Total                              21,647      518,419      540,066         1,954            -         1,954   
================================================================================================================

======================================================================================                          
                                               TOTAL IN      TOTAL IN                                           
                                   TOTAL         LOCAL        FOREIGN       TOTAL                               
             ITEMS                             CURRENCY      CURRENCY                                           
--------------------------------------------------------------------------------------                          
                                                                                                                
 ACCOUNTS RECEIVABLES                                                                                           
 Receivables                         8,384         8,384             -         8,384                            
 Mortgages and leases                                                                                           
 receivables                         2,258         2,258             -         2,258                            
 Other receivables                 137,850        71,075        66,775       137,850                            
                               -------------------------------------------------------                          
 Total                             148,492        81,717        66,775       148,491                            
--------------------------------------------------------------------------------------                          
 LIABILITIES                                                                                                    
 Customer advances                     186           186             -           186                            
 Taxes payable                       9,674         9,674             -         9,674                            
 Trade accounts payable              6,350         6,350             -         6,350                            
 Other liabilities                   4,296         4,296             -         4,296                            
 Short and long term debt          521,171         2,752       518,419       521,171                            
 Salaries and social security                                                                                   
 payable                               343           343             -           343                            
                               -------------------------------------------------------                          
 Total                             542,020        23,601       518,419       542,020                            
======================================================================================                          

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 INFORMATION REQUIRED BY SECTION 68 OF THE
 BUENOS AIRES STOCK EXCHANGE REGULATIONS
 BALANCE SHEET AS OF JUNE 30, 2002

Stated in thousands of pesos

4-b.   Breakdown by adjustment clause                                           

                                                        [Enlarge/Download Table]

=====================================================================================================================
                                                   CURRENT                                NON-CURRENT                
                                  -----------------------------------------------------------------------------------

                                     WITHOUT        WITH                       WITHOUT        WITH                   
                                   ADJUSTMENT    ADJUSTMENT                  ADJUSTMENT    ADJUSTMENT      TOTAL     
              ITEMS                  CLAUSE        CLAUSE     TOTAL CURRENT    CLAUSE        CLAUSE     NON-CURRENT  
---------------------------------------------------------------------------------------------------------------------
                                                                                                                     
 ACCOUNTS RECEIVABLES                                                                                                
 Receivables                             8,384             -         8,384             -             -            -  
 Mortgages and leases receivables            -             -             -         2,258             -        2,258  
 Other receivables                      52,476             -        52,476        85,373             -       85,373  
                                  -----------------------------------------------------------------------------------
 Total                                  60,860             -        60,860        87,631             -       87,631  
---------------------------------------------------------------------------------------------------------------------
 LIABILITIES                                                                                                         
 Customer advances                         186             -           186             -             -            -  
 Taxes payable                           9,674             -         9,674             -             -            -  
 Trade accounts payable                  6,350             -         6,350             -             -            -  
 Other liabilities                       2,342             -         2,342         1,954             -        1,954  
 Short and long term debt              521,170             -       521,170             -             -            -  
 Salaries and social security                                                                                        
 payable                                   343             -           343             -             -            -  
                                  -----------------------------------------------------------------------------------
 Total                                 540,065             -       540,065         1,954             -        1,954  
=====================================================================================================================

==========================================================================================                           
                                                    TOTAL         TOTAL                                              
                                                   WITHOUT        WITHT                                              
                                                 ADJUSTMENT    ADJUSTMENT                                            
              ITEMS                   TOTAL        CLAUSE        CLAUSE         TOTAL                                
------------------------------------------------------------------------------------------                           
                                                                                                                     
 ACCOUNTS RECEIVABLES                                                                                                
 Receivables                             8,384         8,384             -         8,384                             
 Mortgages and leases receivables        2,258         2,258             -         2,258                             
 Other receivables                     137,849       137,849             -       137,849                             
                                  --------------------------------------------------------                           
 Total                                 148,491       148,491             -       148,491                             
------------------------------------------------------------------------------------------                           
 LIABILITIES                                                                                                         
 Customer advances                         186           186             -           186                             
 Taxes payable                           9,674         9,674             -         9,674                             
 Trade accounts payable                  6,350         6,350             -         6,350                             
 Other liabilities                       4,296         4,296             -         4,296                             
 Short and long term debt              521,170       521,170             -       521,170                             
 Salaries and social security                                                                                        
 payable                                   343           343             -           343                             
                                  --------------------------------------------------------                           
 Total                                 542,019       542,019             -       542,019                             
==========================================================================================                           

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 INFORMATION REQUIRED BY SECTION 68 OF THE
 BUENOS AIRES STOCK EXCHANGE REGULATIONS
 BALANCE SHEET AS OF JUNE 30, 2002

Stated in thousands of pesos

4-c. Breakdown of accounts receivable and liabilities by interest clause        

                                                        [Enlarge/Download Table]

================================================================================================================
                                                 CURRENT                              NON-CURRENT               
                                 -------------------------------------------------------------------------------
                                                       NOT-                                    NOT-     TOTAL   
                                 ACCRUING INTEREST  ACCRUING    TOTAL   ACCRUING INTEREST   ACCRUING     NON-   
                                                     INTEREST  CURRENT                       INTEREST  CURRENT  
----------------------------------------------------------------------------------------------------------------
                                 FIXED   VARIABLE                         FIXED    VARIABLE                     
                                 RATE      RATE                            RATE      RATE                       
                                 -------------------                    --------------------                    
                                                                                                                
 ACCOUNTS RECEIVABLES                                                                                           
 Receivables                     5,581      --       2,803     8,384      --           --       --        --    
 Mortgages and leases                                                                                           
 receivables                      --        --        --        --         620         --      1,638     2,258  
 Other receivables                 265      --      52,211    52,476    73,308         --     12,065    85,373  
                             -----------------------------------------------------------------------------------
 Total                           5,846      --      55,014    60,860    73,928         --     13,703    87,631  
----------------------------------------------------------------------------------------------------------------
 LIABILITIES                                                                                                    
 Customer advances                --        --         186       186      --           --       --        --    
 Taxes payable                    --        --       9,674     9,674      --           --       --        --    
 Trade accounts payable           --        --       6,350     6,350      --           --       --        --    
 Other liabilities                --        --       2,342     2,342       725         --      1,229     1,954  
 Short and long term debt         --     521,170      --     521,170      --           --       --        --    
 Salaries and social security                                                                                   
 payable                          --        --         343       343      --           --       --        --    
                             -----------------------------------------------------------------------------------
 Total                            --     521,170    18,895   540,065       725         --      1,229     1,954  
================================================================================================================

=====================================================================                                           

                                          TOTAL     TOTAL                                                       
                               TOTAL    ACCRUING  NOT-ACCRU  TOTAL                                              
                                        INTEREST  INTERESTING                                                   
---------------------------------------------------------------------                                           
                                                                                                                
 ACCOUNTS RECEIVABLES                                                                                           
 Receivables                    8,384     5,581     2,803     8,384                                             
 Mortgages and leases                                                                                           
 receivables                    2,258       620     1,638     2,258                                             
 Other receivables            137,849    73,573    64,276   137,849                                             
                             ----------------------------------------                                           
 Total                        148,491    79,774    68,717   148,491                                             
---------------------------------------------------------------------                                           
 LIABILITIES                                                                                                    
 Customer advances                186      --         186       186                                             
 Taxes payable                  9,674      --       9,674     9,674                                             
 Trade accounts payable         6,350      --       6,350     6,350                                             
 Other liabilities              4,296       725     3,571     4,296                                             
 Short and long term debt     521,170   521,170      --     521,170                                             
 Salaries and social security                                                                                   
 payable                          343      --         343       343                                             
                             ----------------------------------------                                           
 Total                        542,019   521,895    20,124   542,019                                             
=====================================================================                                           

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 INFORMATION REQUIRED BY SECTION 68 OF THE
 BUENOS AIRES STOCK EXCHANGE REGULATIONS
 BALANCE SHEET AS OF JUNE 30, 2002

Stated in thousands of pesos

5.   Intercompany                                                               

a.   Intercompany interest                                            
See Schedule C to the financial statements.                 

b.   Intercompany debit/credit balances (Note 10)                     

Current mortgages and leases receivables                              
----------------------------------------                              

   =========================================================================
                                                     June 30, 2002
                                                       ---------------------
Intercompany:                                                         

   Abril S.A.                                                        9
   Alternativa Gratis S.A.                                           1
   Alto Palermo S.A.                                               384
   Altocity.Com S.A.                                                54
   Baldovinos S.A.                                                 723
   Banco Hipotecario S.A.                                            2
   Cresud S.A.C.I.F.                                               132
   Dolphin Fund Management S.A.                                    128
   Inversora Bolivar S.A                                         1,941
   Red Alternativa S.A.                                              5
   Tarshop Sociedad Anonima                                         11
   =========================================================================

Non-current mortgages and leases receivables                          
--------------------------------------------                          
   =========================================================================
                                                     June 30, 2002
                                                       ---------------------
Intercompany:                                                         

   Alto Palermo S.A.                                             1,638
   Baldovinos S.A.                                                  91

   =========================================================================

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 INFORMATION REQUIRED BY SECTION 68 OF THE
 BUENOS AIRES STOCK EXCHANGE REGULATIONS
 BALANCE SHEET AS OF JUNE 30, 2002

Stated in thousands of pesos

Other current receivables                                                       
-------------------------                                                       

=============================================================================== 
                                                       June 30, 2002
                                                         ---------------------
Intercompany:                                                                   
Emprendimiento Recoleta S.A.                                           20 
Dolphin Fund Management S.A.                                           58 
Banco Hipotecario S.A.                                                  1 
Inversora Bolivar S.A.                                                  7 
Ritelco S.A.                                                       30,129 
Palermo Invest S.A                                                 13,135 
=============================================================================== 

Other non current receivables                                                   
-----------------------------                                                   

=============================================================================== 
                                                       June 30, 2002
                                                         ---------------------
Intercompany:                                                                   
Alto Palermo S.A.                                                  73,160 

=============================================================================== 

Current trade accounts payable                                                  
------------------------------                                                  

=============================================================================== 
                                                       June 30, 2002
                                                         ---------------------
Intercompany:                                                                   
Alto Palermo S.A.                                                     140 
Cresud S.A.C.I.F                                                       42 
Dolphin Fund Management S.A                                            45 
Emprendimiento Recoleta S.A.                                            4 
Fibesa                                                                  2 
=============================================================================== 

Other current liabilities                                                       
-------------------------                                                       
=============================================================================== 
                                                         June 30, 2002
                                                         ---------------------
Intercompany:                                                                   
Baldovinos S.A.                                                        35 
Cresud S.A.                                                             8 
Tarshop S.A.                                                            3 
=============================================================================== 

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 INFORMATION REQUIRED BY SECTION 68 OF THE
 BUENOS AIRES STOCK EXCHANGE REGULATIONS
 BALANCE SHEET AS OF JUNE 30, 2002

Stated in thousands of pesos

Other non current liabilities                                                   
======================================================================          
                                       June 30, 2002
                                         -------------------
Intercompany:                                                                   
Alto Palermo S.A..                                           503          
======================================================================          

6.   None.                                                                      

7.   In view of the nature of the inventory, no physical inventories are        
performed and there are no frozen assets.                             

8.   Not applicable. See Notes 2.a., 2.b., 2.c. and 2.d. to the financial       
statements.                                                           

9.   None.                                                                      

10.  None.                                                                      

11.  None.                                                                      

12.  See Notes 2.a., 2.b., 2.c. and 2.d. to the financial statements.           

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 INFORMATION REQUIRED BY SECTION 68 OF THE
 BUENOS AIRES STOCK EXCHANGE REGULATIONS
 BALANCE SHEET AS OF JUNE 30, 2002

Stated in thousands of pesos

13.    Insured Assets.                                                          

                                                        [Enlarge/Download Table]

                                        Insured     Accounting                                                       
                                        amounts       values                        Risk covered                     
                                      ------------  ------------ ----------------------------------------------------
                                                                                                                     
Alsina 934 Capital                (3)       1,890         1,347  Fire, explosion with additional coverage and debris 
                                                                 removal                                             

Alsina 934 Capital                (3)         308         1,347  Third party liability with additional coverage and  
                                                                 minor risks.                                        

Av. de Mayo 589-99                (3)       2,700         3,738  Fire, explosion with additional coverage and debris 
                                                                 removal                                             

Av. de Mayo 589-99                (3)       1,000         3,738  Third party liability with additional coverage and  
                                                                 minor risks.                                        

Av. Alicia M. de Justo 1714 Dock  (1)      17,000            57  Fire, explosion with additional coverage and        
13 Capital                                                       debris removal                                      

Av. Alicia M. de Justo 1714 Dock  (1)         555            57  Third party liability with additional coverage and  
13  Capital                                                      minor risks.                                        

Av. Alicia M. de Justo 750 Dock   (1)      16,775           406  Fire, explosion with additional coverage and        
5 Capital                                                        debris removal                                      

Av. Alicia M. de Justo 750 Dock   (1)         202           406  Third party liability with additional coverage and  
5 Capital                                                        minor risks.                                        

Av. Alicia M. de Justo 840 Dock   (1)      17,550           113  Fire, explosion with additional coverage  and       
6 Capital                                                        debris removal                                      

Av. Alicia M. de Justo 840 Dock   (1)         406           113  Third party liability with additional coverage and  
6 Capital                                                        minor risks.                                        

Bolivar 108 e H. Yrigoyen 476               5,160             -  Fire, explosion with additional coverage and        
Capital                                                          debris removal                                      

Bolivar 108 e H. Yrigoyen 476               3,199             -  Third party liability with additional coverage and  
Capital                                                          minor risks.                                        

Constitucion 1111 Capital                     420         4,139  Fire, explosion with additional coverage and debris 
                                                                 removal                                             

Constitucion 1111 Capital                     600         4,139  Third party liability with additional coverage and  
                                                                 minor risks.                                        

Constitucion 1111 TIA Capital     (3)       1,500         4,139  Fire, explosion with additional coverage and debris 
                                                                 removal                                             

Constitucion 1111 TIA Capital     (3)       5,000         4,139  Third party liability with additional  coverage and 
                                                                 minor risks.                                        

Dorrego 1916 Capital              (4)      17,430            12  Fire, explosion with additional coverage and debris 
                                                                 removal                                             

Dorrego 1916 Capital              (4)         506            12  Third party liability with additional coverage and  
                                                                 minor risks.                                        

Edificios costeros Dique 2 Este.           14,700        21,197  Fire, explosion with additional coverage and        
Dockitos. P. Madero Capital                                      debris removal                                      

Edificios costeros Dique 2 Este.            1,631        21,197  Third party liability with additional coverage and  
Dockitos. P. Madero Capital                                      minor risks.                                        

Edificios costeros Dique 4 O.     (1)      17,000        15,877  Fire, explosion with additional coverage and        
Cosentini 240 Capital                                            debris removal                                      

Edificios costeros Dique 4 O.     (1)       1,002        18,877  Third party liability with additional coverage and  
Cosentini 240 Capital                                            minor risks.                                        

F. Alcorta 3351 Palacio Alcorta   (1)      30,250             -  Fire, explosion with additional coverage and        
Capital                                                          debris removal                                      

F. Alcorta 3351 Palacio Alcorta   (1)       1,655             -  Third party liability with additional coverage and  
Capital                                                          minor risks.                                        

Gurruchaga 274 Torres Jardin III  (2)      10,736           150  Fire, explosion with additional coverage and        
Capital                                                          debris removal                                      

Gurruchaga 274 Torres Jardin III  (2)         601           150  Third party liability with additional coverage and  
Capital                                                          minor risks.                                        

ING Butty 240 Laminar Plaza       (1)      47,250        25,343  Fire, explosion with  additional coverage and       
Capital                                                          debris removal                                      

ING Butty 240 Laminar Plaza       (1)       4,130        25,343  Third party liability with additional coverage and  
Capital                                                          minor risks.                                        

Libertador 450-98  Capital        (1)      33,600        33,744  Fire, explosion with additional coverage and        
                                                                 debris removal                                      

Libertador 450-98  Capital        (1)       3,461        33,744  Third party liability with additional coverage and  
                                                                 minor risks.                                        

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 INFORMATION REQUIRED BY SECTION 68 OF THE
 BUENOS AIRES STOCK EXCHANGE REGULATIONS
 BALANCE SHEET AS OF JUNE 30, 2002

Stated in thousands of pesos

13.    Insured Assets (Continued)                                               

                                                        [Enlarge/Download Table]

                                    Insured     Accounting                                                       
                                    amounts       values                        Risk covered                     
                                  ------------  ------------ ----------------------------------------------------
                                                                                                                 
Av. Libertador 602  Capital   (1)       1,002         2,248  Third party liability with additional coverage and  
                                                             minor risks.                                        

Av. Libertador 602  Capital   (1)      25,200         2,248  Fire, explosion with additional coverage and debris 
                                                             removal                                             

Madero 1020 Capital           (1)      28,350        13,571  Fire, explosion with additional coverage and debris 
                                                             removal                                             

Madero 1020 Capital           (1)       2,933        13,571  Third party liability with additional coverage and  
                                                             minor risks.                                        

Madero 940  Capital           (1)      36,960         4,147  Fire, explosion with additional coverage and debris 
                                                             removal                                             

Madero 940  Capital           (1)       1,315         4,147  Third party liability with additional coverage and  
                                                             minor risks.                                        

Maipu 1270 - 1300 Capital              22,050        36,922  Fire, explosion with additional coverage and debris 
                                                             removal                                             

Maipu 1270 - 1300 Capital               4,061        36,922  Third party liability with additional coverage and  
                                                             minor risks.                                        

Padilla 870 Torres Jardin II  (2)       9,540           409  Fire, explosion with additional coverage and        
Capital                                                      debris removal                                      

Padilla 870 Torres Jardin II  (2)         607           409  Third party liability with additional coverage and  
Capital                                                       minor risks.                                       

Reconquista 823 Capital       (3)      13,000        15,807  Fire, explosion with additional coverage and debris 
                                                             removal                                             

Rivadavia 2768 Capital        (1)       3,610           136  Fire, explosion with additional coverage and debris 
                                                             removal                                             

Rivadavia 2768 Capital        (1)         251           136  Third party liability with additional coverage and  
                                                             minor risks.                                        

Sarmiento 501                 (1)       3,885           818  Fire, explosion with additional coverage and debris 
                                                             removal                                             

Sarmiento 501                 (1)         607           818  Third party liability with additional coverage and  
                                                             minor risks.                                        

Serrano 287 Torres Jardin I   (2)       9,450            58  Fire, explosion with additional coverage and        
Capital                                                      debris removal                                      

Serrano 287 Torres Jardin I   (2)         607            58  Third party liability with additional coverage and  
Capital                                                      minor risks.                                        

Suipacha 664                           15,750         9,021  Fire, explosion with additional coverage and debris 
                                                             removal                                             

Suipacha 664                              722         9,021  Third party liability with additional coverage and  
                                                             minor risks.                                        

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 INFORMATION REQUIRED BY SECTION 68 OF THE
 BUENOS AIRES STOCK EXCHANGE REGULATIONS
 BALANCE SHEET AS OF JUNE 30, 2002

Stated in thousands of pesos

General                                                                         
-------                                                                         

In the case of insurance covering fire and explosion with additional coverage,  
the amounts insured are stated at replacement and/or reconstruction to an "as   
new" condition value, not including land and foundations, due to the            
apportionment rules.                                                            

Insured amounts correspond to units belonging to the company that are being     
sold, and/or units sold under mortgages not having individual policies with     
assigned rights.                                                                

Notes:                                                                          
------                                                                          

(1)  Insured amounts correspond to the total for the building. The amount       
insured for each co-owner is obtained by applying the percentage of   
co-ownership to the total insurance.                                  

(2)  Insured amounts correspond solely to jointly held areas.                   

(3)  Insurance purchased by tenants with provisions for the assignment of       
rights.                                                               

(4)  Insured amounts correspond to units not yet having a bill of sale.         

(5)  Insured amounts correspond to common areas and partially to individual     
areas.                                                                

In our opinion, the above-described policies adequately cover current risks.    

14.  Not applicable.                                                            

15.  See comments in Note 1 to the consolidated financial statements.           

16.  Not applicable.                                                            

17.  None.                                                                      

18.  In accordance which was stipulated in loans agreements, the Company shall  
not distribute dividends until this obligations would be cancelled.   

BUENOS AIRES, SEPTEMBER 9, 2002.                                                

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IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

 BUSINESS OVERVIEW

 In thousands of pesos

1.   BRIEF COMMENTS ON THE COMPANY'S ACTIVITIES DURING THE YEAR, INCLUDING      
REFERENCES TO SIGNIFICANT EVENTS AFTER THE END OF THE PERIOD.         

See  attached.                                                                  

2.   CONSOLIDATED SHAREHOLDERS' EQUITY STRUCTURE AS COMPARED WITH THE SAME YEAR 
FOR THE FOUR PREVIOUS YEARS.                                          

                                                        [Enlarge/Download Table]

                         June 30, 2002  June 30, 2001    June 30, 2000    June 30, 1999   June 30, 1998
                         -------------- --------------  ---------------  --------------  --------------
                                                                                                       
Current Assets                136,308        221,875          246,196         299,584         453,672  
Non-Current Assets          1,008,407      1,272,674        1,419,031       1,430,982       1,316,241  
                         -------------- --------------  ---------------  --------------  --------------
TOTAL                       1,144,715      1,494,549        1,665,227       1,730,566       1,769,913  
                         ============== ==============  ===============  ==============  ==============
Current Liabilities           606,060        385,661          236,344         290,212         238,533  
Non-Current Liabilities         3,021         34,497          215,863         218,322         354,999  
                         -------------- --------------  ---------------  --------------  --------------
SUBTOTAL                      609,081        420,158          452,207         508,534         593,532  
                         -------------- --------------  ---------------  --------------  --------------
Minority interest in                                                                                   
subsidiaries                   75,218        114,356          112,603         112,971         106,926  
                         -------------- --------------  ---------------  --------------  --------------
Shareholders' Equity          460,416        960,035        1,100,417       1,109,062       1,069,455  
                         -------------- --------------  ---------------  --------------  --------------
Total                       1,144,715      1,494,549        1,665,227       1,730,567       1,769,913  
                         ============== ==============  ===============  ==============  ==============

3.   CONSOLIDATED INCOME STRUCTURE AS COMPARED WITH THE SAME YEAR FOR THE FOUR  
PREVIOUS YEARS.                                                       

                                                        [Enlarge/Download Table]

                           June 30, 2002     June 30, 2001  June 30, 2000   June 30, 1999   June 30, 1998
                           --------------   --------------  -------------  --------------  --------------
                                                                                                         
Operating ordinary profit       (29,564)          26,798         46,110          71,409          67,137  
Financial results               (445,821)        (83,358)      (24,719)         (35,333)       (12,158)  
Equity in earnings of                                                                                    
affiliated companies            (17,797)           6,471         10,810          46,734          31,424  
Other income (expenses)           (4,322)         (5,266)       (6,371)           9,458          (3,294) 
                             -------------  --------------  -------------  --------------  --------------
LOSS BEFORE TAXES               (497,504)        (55,355)        25,830          92,268          83,109  
Income tax/ asset tax             (7,233)         (3,139)        (9,460)               -               - 
Minority interest                   5,118         (1,459)        (4,818)         (5,282)        (11,109) 
                             -------------  --------------  -------------  --------------  --------------
NET (LOSS) INCOME               (499,619)        (59,953)        11,552          86,986          72,000  
                             =============  ==============  =============  ==============  ==============

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4.   STATISTICAL DATA AS COMPARED WITH THE SAME YEAR OF THE FOUR PREVIOUS YEARS.

Summary of properties sold in units and thousands of pesos.           

                                                        [Enlarge/Download Table]

                                     Accumulated    Accumulated   Accumulated    Accumulated   Accumulated  
                                        as of          as of         as of          as of         as of     
            Real Estate                June 30,      June 30,       June 30,    June 30, 1999    June 30,   
                                         2002          2001           2000           (1)           1998     
                                          (1)           (1)            (1)                          (1)     
------------------------------------ ------------- -------------- ------------- -------------- -------------
                                                                                                            
Apartments & Loft Buildings                                                                                 
---------------------------                                                                                 
Torres Jardin                              1.837          4.680         6.649         10.456        12.428  
Torres de Abasto                           1.784          5.314          4.577        25.976        10.454  
 Alcorta Palace                              540              -            18          2.238        29.814  
Concepcion Arenal and Dorrego 1916           323          3.635         2.970          2.314         2.097  
Alto Palermo Park                          8.729        (1.062)         2.782          4.067        10.499  
Other                                      1.635          1.491         1.518          3.723             -  

Residential Communities                                                                                     
-----------------------                                                                                     
Abril / Baldovinos                        11.188         30.235        19.537         21.088        57.403  
Villa Celina I, II and III                  (46)              6           106          2.516         3.361  
Villa Celina IV and V                        121          2.582         5.736              -             -  
Other                                          -              -           141          2.586         2.019  

Undeveloped parcels of land                                                                                 
---------------------------                                                                                 
Monserrat                                      -          1.069         2.205              -             -  
Dique IV                                       -         10.955             -              -         5.378  
Puerto Madero Dique II                         -              -             -         48.905             -  

Other                                                                                                       
-----                                                                                                       
Llao Llao                                      -              -        14.671              -             -  
Galerias Pacifico                              -              -         5.869              -             -  
Puerto Madero Dock 6                         103            154             -            779         5.820  
Gallo y Lavalle                                -              -             -              -        10.059  
Sarmiento 580                                  -          9.644             -              -             -  
Av. de Mayo 701                                -          2.766             -              -             -  
Montevideo 1975                                -          2.778             -              -             -  
Santa Fe 1588                              7.267              -             -              -             -  
Other                                      8.206          4.915         2.709            628        14.540  
                                     ------------- -------------- ------------- -------------- -------------
                                          41.687         79.162        69.488        125.276       163.872  
                                     ============= ============== ============= ============== =============

(1)  Deductions on account of gross sales tax are not included.                 

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5.   KEY RATIOS AS COMPARED WITH THE SAME YEAR OF THE FOUR PREVIOUS YEARS.      

                                                        [Enlarge/Download Table]

                   June 30,            Jund 30,            Jund 30,            June 30,           June 30,              
                     2002                2001                2000                1999               1998                
                 ------------        ------------        ------------        ------------        ------------           
                                                                                                                        
LIQUIDITY RATIO                                                                                                         
Current Assets        136.308 = 0,22        221.875 = 0,58        246.196 = 1,04      299.584 = 1,03      453.672 = 1,90
                 ------------          ------------          ------------        ------------        ------------       
Current               606.060               385.661               236.344             290.212             238.533       
Liabilities                                                                                                             

INDEBTEDNESS RATIO                                                                                                      

Total liabilities     609.081 = 1,32        420.158 = 0,44        452.207 = 0,41      508.534 = 0,46      593.533 = 0,55
                 ------------          ------------          ------------        ------------        ------------       
Shareholders'         460.416               960.035             1.100.417           1.109.062           1.069.455       
Equity                                                                                                                  

INCOME BEFORE INCOME TAX, TAX ON ASSETS AND MINORITY INTEREST.                                                          

                   June 30,              June 30,              June 30,           June 30,            June 30,          
                     2002                  2001                  2000               1999                1998            
                 ------------          ------------          ------------        ------------        ------------       
Income                                                                                                                  
Before income tax/                                                                                                      

Tax on assets        (497.504) = (0,52)     (55.355) = (0,05)      25.830 = 0,02       92.268 = 0,09       83.109 = 0,08
                 ------------          ------------          ------------        ------------        ------------       
Shareholders'         960.035             1.019.988             1.088.866           1.022.075            997.455        
equity at end                                                                                                           
excluding (loss)                                                                                                        
income for the                                                                                                          
year                                                                                                                    

6.   BRIEF COMMENT ON THE FUTURE PERSPECTIVES FOR THE ENSUING YEAR              

See attached.                                                         

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[PRICEWATERHOUSECOOPERS LOGO]                                                   

[SC INTERNATIONAL LOGO]                                                         
                                                                    ABELOVICH,
                                                                        POLANO
                                                                   & ASOCIADOS

 REPORT OF INDEPENDENT ACCOUNTANTS

To the Shareholders of                                                          
IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA                            

1.   We have audited the balance sheets of IRSA Inversiones y Representaciones  
   Sociedad Anonima at June 30, 2002 and 2001, and the related statements of
income and cash flows for the years then ended, and the statement of  
  changes in shareholders' equity for the year ended on June 30, 2002, and
   the complementary notes 1 to 15 and exhibits A to I. Furthermore, we have
audited the consolidated financial statements of IRSA Inversiones y   
     Representaciones Sociedad Anonima with its subsidiaries for the years ended
on June 30, 2002 and 2001, which are presented as complementary       
   information. The preparation and issuance of the financial statements are
  the responsibility of the Company's management. Our responsibility is to
issue an opinion on the financial statements, based on our audit.     

2.   We conducted our audits of these statements in accordance with auditing    
     standards in force in Argentina, which require that we plan and perform the
     audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement and to form an opinion on the       
reasonableness of relevant information contained in the financial     
statements. 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 statements presentation.
We believe that our audits provide a reasonable basis for our opinion.

3.   As established by Resolution 1/02 of the Professional Council in Economic  
   Sciences of the Autonomous City of Buenos Aires and Resolution No. 392 of
  the National Securities Commission, the Company has given recognition to
the effects of the devaluation as from January 1, 2002.               

4.   Note 1 to the consolidated financial statements details the situation at   
     the end of the year related to the economic measures issued by the National
  Government to confront the Argentine crisis, some of which may have been
     pending issue at the date of preparation of these financial statements. The
     impact generated by all these measures adopted to date by the Government on
 the financial statements of the Company at June 30, 2002 was recognized
according to the evaluations and estimates made by Management when    
  preparing the financial statements. Actual results could differ from the
 evaluations and estimates made at the date of preparing these financial
statements and these differences could be significant. Therefore, the 
Company's financial statements may not report all the adjustments that
     could result from these adverse conditions. Furthermore, at this time it is
    not possible to foresee the future development of the country's economy or
  its consequences on the economic and financial situation of the Company.
Thus, any decision that must be made on the basis of these financial  
   statements must take into account the effects of these measures and their
future development and the Company's financial statements must be     
considered in the light of these uncertain circumstances.             

PRICE WATERHOUSE & CO.                           ABELOVICH, POLANO & ASSOCIADOS 
Av. A. Moreau de Justo 270, Piso 2(nd)           25 de Mayo 596 - 8(th)Piso     
C1107AAF Ciudad de Buenos Aires - Argentina      (1002) Buenos Aires - Argentina
Tel. (54-11) 4319-4600                           Tel./Fax 4312-8525 -           
Fax: (54-11) 4315-6448/9                         E-mail: abelovich@elsitio.net  
www.pwcglobal.com                                                               

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[PRICEWATERHOUSECOOPERS GRAPHIC OMITTED]                                        

[SC INTERNATIONAL GRAPHIC OMITTED]                                              
                                                                    ABELOVICH,
                                                                        POLANO
                                                                   & ASOCIADOS
REPORT OF INDEPENDENT ACCOUNTANTS (Contd.)

5.   As mentioned in Note 6 to the financial statements, at June 30, 2002 the   
   Company was unable to meet certain financial ratios required by the trust
  agreement related to the issuance of negotiable obligations for US$ 39.3
    million. As mentioned in Note 15 to the consolidated financial statements,
    the subsidiary Hoteles Argentinos S.A. has not paid principal installments
  amounting to US$ 300 thousand, with original maturities set for April 29
and July 29, 2002, and an interest installment amounting to US$ 127   
thousand which fell due on July 29, 2002, under the US$ 12 million    
     long-term loan agreement secured by a mortgage entered into with BankBoston
N.A. Buenos Aires Branch.                                             

6.   During the year ended on June 30, 2002, the Company recorded a net loss of 
$ 499,619 thousand, accumulated losses of $ 496,479 thousand and a    
    shortfall of working capital of $ 456,524 thousand (consolidated shortfall
    of working capital of $ 469,752 thousand). Company Management is currently
    defining and implementing an action plan to counteract these circumstances
  as has been detailed in Note 1 to the consolidated financial statements.
   These financial statements have been prepared using accounting principles
     applicable to a going concern. Therefore, these financial statements do not
   include the effects of possible adjustments or reclassifications, if any,
   that might be required if the above situation is not resolved in favor of
  continuing the Company's activities and the Company were obliged to sell
its assets and settle its liabilities, including contingencies, in    
conditions other than those of the normal course of its business.     

7.   In our opinion, subject to the effects on the financial statements of      
possible adjustments and reclassifications that could be required as a
    result of the resolution of the situations described in points 4, 5 and 6:

a)   the financial statements of IRSA Inversiones y Representaciones Sociedad   
     Anonima present fairly, in all material respects, its financial position at
  June 30, 2002 and 2001, the results of its operations and its cash flows
   for the years then ended, and the changes in shareholders' equity for the
 year ended on June 30, 2002, in accordance with professional accounting
standards in effect in the Autonomous City of Buenos Aires.           

b)   the consolidated financial statements of IRSA Inversiones y                
    Representaciones Sociedad Anonima with its subsidiaries present fairly, in
     all material respects, its consolidated financial position at June 30, 2002
    and 2001, the consolidated results of operations and the consolidated cash
    flows for the years then ended, in accordance with professional accounting
standards in effect in the Autonomous City of Buenos Aires.           

PRICE WATERHOUSE & CO.                           ABELOVICH, POLANO & ASSOCIADOS 
Av. A. Moreau de Justo 270, Piso 2(nd)           25 de Mayo 596 - 8(th)Piso     
C1107AAF Ciudad de Buenos Aires - Argentina      (1002) Buenos Aires - Argentina
Tel. (54-11) 4319-4600                           Tel./Fax 4312-8525 -           
Fax: (54-11) 4315-6448/9                         E-mail: abelovich@elsitio.net  
www.pwcglobal.com                                                               

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[PRICEWATERHOUSECOOPERS GRAPHIC OMITTED]                                        

[SC INTERNATIONAL GRAPHIC OMITTED]                                              
                                                                    ABELOVICH,
                                                                        POLANO
                                                                   & ASOCIADOS

REPORT OF INDEPENDENT ACCOUNTANTS (Contd.)

8.   In accordance with current regulations we report that:                     

a)   the financial statements of IRSA Inversiones y Representaciones Sociedad   
  Anonima and its consolidated financial statements are transcribed to the
"Inventory and Balance Sheet Book" and comply with the pertinent      
resolutions of the National Securities Commission;                    

b)   the financial statements of IRSA Inversiones y Representaciones Sociedad   
Anonima arise from official accounting records carried in all formal  
respects in accordance with legal requirements;                       

c)   we have read the summary of activity and the additional information to the 
    notes to the financial statements required by sect. 68 of the Buenos Aires
 Stock Exchange Regulations, on which, as regards those matters that are
within our competence, we have no observation to make;                

d)   at June 30, 2001, the debt accrued in favor of the Integrated Pension and  
     Survivors' Benefit System according to the accounting records amounted to $
120 thousand, none of which was claimable at that date.               

Buenos Aires                                                                    
September 9, 2002                                                               

                                                                [Download Table]

                                                                            
 ABELOVICH, POLANO & ASOCIADOS         PRICE WATERHOUSE & Co.               

                            (Partner)                            (Partner)  
-------------------------------------  -----------------------------------  
    Dr. Jose Daniel Abelovich                Carlos Martin Barbafina        
    Public Accountant (U.B.A.)             Public Accountant (U.C.A.)       
  C.P.C.E.C.A.B.A. T(o)102 F(o)191         C.P.C.E.C.A.B.A. T(o)175 F(o)65  
Professional Registration of the Firm  Professional Registration of the Firm
  C.P.C.E.CAP.FED. T(o)1 F(o)240           C.P.C.E.CAP.FED. T(o)1 F(o)1     


PRICE WATERHOUSE & CO.                           ABELOVICH, POLANO & ASSOCIADOS 
Av. A. Moreau de Justo 270, Piso 2(nd)           25 de Mayo 596 - 8(th)Piso     
C1107AAF Ciudad de Buenos Aires - Argentina      (1002) Buenos Aires - Argentina
Tel. (54-11) 4319-4600                           Tel./Fax 4312-8525 -           
Fax: (54-11) 4315-6448/9                         E-mail: abelovich@elsitio.net  
www.pwcglobal.com                                                               

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SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the    
registrant has duly caused this report to be signed on its behalf by the        
undersigned, thereunto duly authorized, in the city of Buenos Aires, Argentina. 

              IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANONIMA

By:                                   
                        ------------------------------------------------------
Name: Saul Zang               
                       Title: Second Vice Chairman of the Board of Directors

Dated: November 6, 2002                                                         

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘6-K’ Filing		Date		First		Last			Other Filings
		12/31/06		34
		12/27/05		37		100
		4/7/05		61		62			6-K
		12/31/04		34
		12/10/03		48		131
		12/15/02		34
For Period End:		11/30/02							6-K
Filed on:		11/29/02
		11/27/02		3		4
		11/6/02		2		163
		11/5/02		2		3
		10/9/02		71
		9/30/02		13		124
		9/9/02		12		162
		8/30/02		13		63
		8/29/02		42
		8/22/02		62		132
		8/20/02		10		134
		8/16/02		32		134
		8/2/02		42
		7/31/02		13		60
		7/29/02		80		161
		7/14/02		10
		7/10/02		34
		6/30/02		2		161			20-F
		6/21/02		10
		6/5/02		61
		5/17/02		64
		5/15/02		12		61
		5/10/02		11
		5/3/02		83
		4/30/02		103
		4/26/02		11
		4/24/02		77
		4/15/02		11
		3/31/02		63		124
		3/21/02		64
		3/8/02		13		133
		2/28/02		11		83
		2/8/02		60		78
		2/4/02		10		11
		2/3/02		77		79
		1/31/02		10		103
		1/15/02		102
		1/7/02		46
		1/6/02		77		116
		1/1/02		44		160
		12/31/01		12		111
		12/27/01		102
		12/24/01		60
		12/23/01		46
		12/20/01		124
		12/17/01		101
		12/14/01		101
		12/4/01		13		62
		12/3/01		15		77
		11/15/01		62
		11/9/01		102
		11/7/01		12		83
		11/2/01		12		101
		10/19/01		66		131
		10/11/01		12		61
		9/30/01		99
		9/28/01		12
		9/4/01		34
		8/29/01		23		61
		7/31/01		60
		7/20/01		62		133
		7/5/01		34
		7/1/01		74		143
		6/30/01		5		162
		6/29/01		33
		6/20/01		60
		5/31/01		68
		5/24/01		68
		4/27/01		37
		3/31/01		88
		3/23/01		31
		3/7/01		99
		1/26/01		99
		1/15/01		132
		1/5/01		99
		12/27/00		37		100
		12/22/00		99
		12/21/00		124
		12/20/00		34
		12/18/00		60
		12/14/00		98
		10/30/00		39		40
		7/1/00		74		143
		6/30/00		100		157
		6/15/00		37
		6/1/00		37
		5/24/00		60
		4/18/00		98
		12/17/99		34
		12/15/99		37
		10/28/99		39
		10/14/99		101
		8/31/99		68		132
		8/20/99		34
		7/6/99		34
		7/2/99		105
		6/30/99		117		158
		6/4/99		132
		3/31/99		84
		10/1/98		68
		8/25/98		33
		6/30/98		157
		4/7/98		67		132
		2/25/98		102
		12/27/97		67
		10/30/97		67		132
		7/1/96		44		97
		8/31/95		82		111
		12/20/94		70
		12/12/94		40
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