Quarterly report

3.6.Composition, Structure and Value of Issuer’s Fixed Assets, Information on Plans for Acquisition, Replacement and Retirement of Fixed Assets, and on all Facts of Issuer’s Fixed Assets Burdening

1. Fixed Assets

Fixed assets group	Original (replacement) value of fixed assets, RUR ths	Depreciation charges, RUR ths
Reporting date: 30.09.2007
Buildings	142,714,242	51,636,443
Switches and transmission devices	737,702,942	205,508,404
Machines and equipment	894,121,949	532,602,234
Vehicles	18,988,848	11,378,542
Computers and office equipment	337,332,939	142,427,251
Housing stock	2,392,257	157,278
Land and natural resources	61,013	0
Other PP&E	60,065,094	38,431,548
Total:	2,193,379,284	982,141,700

Depreciation methods by fixed assets groups:

Fixed assets are depreciated for accounting purposes on a straight-line basis based on their original or replacement cost (in case of revaluation) and depreciation rate determined based on their useful lives.

The following changes were made in the Company’s accounting policy in accordance with Order of the RF Ministry of Finance N 147N of 12.12.2005: “The objects of fixed assets with the cost under 10000 rubles per unit shall be reflected in the structure of Inventories”.
Information on the last revaluation of the Company’s fixed assets and fixed assets leased on a long-term basis, have been carried out within five years before the quarter under report:

Fixed assets group	Complete balance sheet value prior to revaluation, RUR	Depreciated cost prior to revaluation, RUR	Date of revaluation	Complete balance sheet value after revaluation, RUR	Depreciated cost after revaluation, RUR
Buildings	1,853,856,000	1,312,379,000	01.01.2003	4,010,036,000	2,857,613,000
Total:	1,853,856,000	1,312,379,000	-	4,010,036,000	2,857,613,000

During the last five fiscal years revaluation of only one group “buildings” of the Issuer’s fixed assets was carried out (as of 30.09.2007).

Revaluation date: 31.12.2002

Revaluation method:

Revaluation was carried out according to market value by direct recalculation on the basis of the documented market prices.

Information about the appraiser:

Full registered name: “ROSTO” Limited Liability Company

Abbreviated name: "RОSТО" Ltd

Location: 102, Novorossiyskaya Str., Krasnodar, 350058

TIN: 2308057388

The revaluation resulted in 1,545,234 thousand rubles. Replacement cost and additional capital increased by 1,545,234 thousand rubles (balance sheet items 120 and 420 accordingly).
Plans of acquisition, replacement, retirement of fixed assets (property, plant and equipment) the cost of which is 10 and more percent of the issuer’s fixed assets (property, plant and equipment) value and of other fixed assets (property, plant and equipment) at the issuer’s discretion:
The Issuer is not planning to make essential changes in the structure of fixed assets (property, plant and equipment), and the Issuer has no plans of acquisition, replacement, retirement of objects of fixed assets (property, plant and equipment) the cost of which is 10 and more percent of the issuer’s fixed assets (property, plant and equipment) value.

Information on all the facts of the Issuer’s fixed assets encumbrances as of September 30, 2007:

Character of the fixed assets burden	Date of the burden occurrence	Valid till	Other terms (balance sheet value, ths RUR)
Left as a security under the Credit Agreement № 218 of 22.12.2003 with the Savings Bank of the Russian Federation	22.12.2003	19.12.2008	806,211.72
Left as a security under the Credit Agreement № 1020 of 19.10.2006 with the Savings Bank of the Russian Federation	19.10.2006	14.04.2008	207,893.566
Left as a security under the Guaranteed Term Credit Facility Agreement of 15.09.2006 and bank Guarantee Agreement № 1808/3961/2014 of 19.09.2006 with OJSC “Vneshtorgbank"	15.09.2006	21.09.2013	2,949,389.837
Left as a security under the Guaranteed Term Credit Facility Agreement of 31.08.2006	31.08.2006	06.10.2009	1,673,403.169
Left as a security under the Credit Agreement № 1025 of 25.10.2006 with the Savings Bank of the Russian Federation	25.10.2005	21.04.2008	150,657.337
Amicable agreement dated 27.12.2006 in respect to file № А32-27336/2005-26/852	27.12.2006	01.01.2012	283,254.959
Left as a security under the Credit Agreement № 060/326/06 оf 26.05.2005 with International Moscow Bank	26.05.2006	26.11.2007	392,092.68
TOTAL			6,070,810,588