Audited consolidating financial statements.

Independent Auditor's Report

To the Board of Directors

Tax Executives Institute, Inc. and TEI Education Fund

We have audited the accompanying consolidating statements of financial position of Tax Executives Institute, Inc. and TEI Education Fund collectively, (the Organization) as of June 30, 2008 and 2007, and the related consolidating statements of activities and cash flows for the years then ended. These consolidating financial statements are the responsibility of the Organization's management. Our responsibility is to express an opinion on these consolidating financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidating financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidating financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidating financial statements referred to above present fairly, in all material respects, the individual and consolidated financial positions of Tax Executives Institute, Inc. and TEI Education Fund as of June 30, 2008 and 2007, and the changes in their net assets and their cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

As discussed in Note C to the consolidating financial statements, the Organization holds auction-rate referred securities within its investment portfolio. The auctions where these securities are bought and sold have been suspended indefinitely.

Tate & Tyron

Washington, DC

July 21, 2008

Consolidating Statements of Financial Position June 30, 2008 and 2007 See notes to the consolidating financial statements. 2008 TO TEIF Total Assets Cash and cash $574,458 $115,439 $689,897 equivalents--Note B Short-term 10,728,624 10,728,624 investments--Notes B & C Accounts receivable 48,595 48,595 Due (to) from -- affiliate Prepaid expenses 92,468 92,468 Long-term 1,820,982 1,820,982 investments--Notes B & C Security deposit -- Investments held for 55,838 55,838...