Form N-17f-2

Securities and Exchange Commission

Washington, D.C. 20549

 

FORM N-17f-2

 

CERTIFICATE OF ACCOUNTING OF SECURITIES AND SIMILAR INVESTMENTS IN THE CUSTODY

OF MANAGEMENT INVESTMENT COMPANIES

 

Pursuant to Rule 17f-2 [17 CRF 270.17f-2]

 

1.      Investment Company Act File Number: 814-00098

   Date examination completed: October 7, 2004

 

2. State Identification Number:

 

AL   AK   AZ   AR   CA   CO
CT   DE   DC   FL   GA   HI
ID   IL   IN   IA   KS   KY
LA   ME   MD   MA   MI   MN
MS   MO   MT   NE   NV   NH
NJ   NM   NY   NC   ND   OH
OK   OR   PA   RI   SC   SD
TN   TX   UT   VT   VA   WA
WV   WI   WY   PUERTO RICO        

Other (specify):

 

3. Exact name of investment company as specified in registration statement:

 

Equus II Incorporated

 

4. Address of principal executive office: (number, street, city, state, zip code)

 

2727 Allen Parkway, 13th Floor, Houston, Texas 77008

Management Statement Regarding Compliance With Certain Provisions of the Investment Company Act of 1940

 

We, as members of management of Equus II Incorporated (the Company), are responsible for complying with the requirements of subsections (b) and (c) of Rule 17f-2, Custody of Investments by Registered Management Investment Companies, of the Investment Company Act of 1940. We are also responsible for establishing and maintaining effective internal controls over compliance with those requirements. We have performed an evaluation of the Company’s compliance with the requirements of subsections (b) and (c) of Rule 17f-2 as of October 7, 2004, and from April 29, 2004 through October 7, 2004.

 

Based on this evaluation, we assert that the Company was in compliance with the requirements of subsections (b) and (c) of Rule 17f-2 of the Investment Company Act of 1940 as of October 7, 2004, and from April 29, 2004 through October 7, 2004, with respect to securities reflected in the investment account of the Company.

 

Equus II Incorporated
By:   /s/    NOLAN LEHMANN        
    Nolan Lehmann

Title

   President
     

Report of Independent Registered Public Accounting Firm

 

To the Board of Directors of

Equus II Incorporated

 

We have examined management’s assertion, included in the accompanying Management Statement Regarding Compliance with Certain Provisions of the Investment Company Act of 1940, about Equus II Incorporated’s (the “Company’s”) compliance with the requirements of subsections (b) and (c) of Rule 17f-2 under the Investment Company Act of 1940 (“the Act”) as of October 7, 2004. Management is responsible for the Company’s compliance with those requirements. Our responsibility is to express an opinion on management’s assertion about the Company’s compliance based on our examination.

 

Our examination was conducted in accordance with the standards of the Public Company Accounting Oversigt Board (United States) and, accordingly, included examining, on a test basis, evidence about the Company’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. Included among our procedures were the following tests performed as of October 7, 2004, and with respect to agreement of security purchases and sales, for the period from April 29, 2004 (the date of our last examination), through October 7, 2004:

 

  •   Count and inspection of all securities located in the vault of Frost National Bank (the “Custodian”) in San Antonio, Texas without prior notice to management;

 

  •   Confirmation of all securities hypothecated, pledged, placed in escrow, or out for transfer with brokers, pledgees and/or transfer agents; and

 

  •   Reconciliation of all such securities to the books and records of the Company and the Custodian.

 

We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on the Company’s compliance with specified requirements.

 

In our opinion, management’s assertion that Equus II Incorporated was in compliance with the requirements of subsections (b) and (c) of Rule 17f-2 of the Investment Company Act of 1940 as of October 7, 2004 with respect to securities reflected in the investment account of the Company is fairly stated, in all material respects.

 

This report is intended solely for the information and use of the Board of Directors, management, and the Securities and Exchange Commission and is not intended to be and should not be used by anyone other than these specified parties.

 

/s/ PricewaterhouseCoopers LLP

Houston, Texas

March 8, 2005