EXHIBIT 13.2 TO FORM 10-K Report of Daniel G. Matthews & Associates, Inc. concerning financial statements for 1995 presented in the 1997 Annual Report to Shareholders DANIEL G. MATTHEWS & ASSOCIATES, INC. CERTIFIED PUBLIC ACCOUNTANTS 210 EAST WELLONS STREET SMITHFIELD, NORTH CAROLINA 27577 919-934-7116 INDEPENDENT AUDITOR'S REPORT Board of Directors Four Oaks Bank & Trust Company Post Office Box 309 Four Oaks, North Carolina 27524 We have audited the accompanying balance sheets of the Four Oaks Bank & Trust Company as of December 31, 1995 and 1994, and the related statements of income, changes in shareholders' equity, cash flows for each of the three years in the period ended December 31, 1995. These financial statements are the responsibility of the Bank's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the 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 financial statements referred to above present fairly, in all material respects, the financial position of the Four Oaks Bank & Trust Company at December 31, 1995 and 1994, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 1995 in conformity with generally accepted accounting principles. /s/ Daniel G. Matthews & Associates, Inc. DANIEL G. MATTHEWS & ASSOCIATES, INC. February 20, 1996