<Page>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File No. 811-6094
THE LATIN AMERICA EQUITY FUND, INC.
(Exact Name of Registrant as Specified in Charter)
466 Lexington Avenue, New York, New York 10017-3140
(Address of Principal Executive Offices) (Zip Code)
J. Kevin Gao, Esq.
The Latin America Equity Fund, Inc.
466 Lexington Avenue
New York, New York 10017-3140
Registrant's telephone number, including area code: (212) 875-3500
Date of fiscal year end: December 31st
Date of reporting period: January 1, 2005 to December 31, 2005
<Page>
ITEM 1. REPORTS TO STOCKHOLDERS.
<Page>
THE LATIN AMERICA
EQUITY FUND, INC.
ANNUAL REPORT
DECEMBER 31, 2005
[LAQ LISTED NYSE(R) LOGO]
LAQ-AR-1205
<Page>
CONTENTS
<Table>
Letter to Shareholders 1
Portfolio Summary 3
Schedule of Investments 5
Statement of Assets and Liabilities 9
Statement of Operations 10
Statement of Changes in Net Assets 11
Financial Highlights 12
Notes to Financial Statements 14
Report of Independent Registered Public Accounting Firm 20
Results of Annual Meeting of Shareholders 21
Tax Information 21
Description of InvestLink(SM) Program 22
Information Concerning Directors and Officers 25
Annual Certifications 28
Advisory Agreement Approval Disclosure 29
Proxy Voting and Portfolio Holdings Information 33
</Table>
LETTER TO SHAREHOLDERS
February 1, 2006
DEAR SHAREHOLDER:
For the year ended December 31, 2005, The Latin America Equity Fund, Inc. (the
"Fund") had an increase in its net asset value (NAV) of 47.92%, assuming
reinvestment of dividends and distributions. By comparison, the Morgan Stanley
Capital International Latin America Index* had an increase of 50.00% (net of
dividend taxation) for the period. Based on market price, the Fund's shares rose
44.06% during the year. As a result, the Fund's discount to its NAV stood at
13.59% on December 31, 2005, compared with a discount of 11.28% at the beginning
of the period.
LATIN AMERICA: LEADING AN OUTPERFORMING ASSET CLASS
The year was a positive one for stock markets around the world, aided by robust
global growth and supportive liquidity conditions. Emerging markets as a group
had overall strong returns in absolute terms and as compared with developed
stock markets, helped in part by strong economic fundamentals, high and rising
commodity prices and low levels of risk aversion.
Latin America outperformed the broader emerging markets group. Brazil was a
standout, reaching all-time highs on the back of a supportive backdrop for
commodity prices, encouraging inflation reports and the anticipation of interest
rate cuts, after an extended cycle of tightening. These factors countered
worries over political scandals that plagued the market in third quarter.
Mexico was another strong performer, supported by encouraging inflation and
corporate earnings news and its ties to the recovering US economy. Chile
benefited from strong domestic demand in addition to its commodity exports.
Argentina was also aided by strength in commodity prices for the year as a
whole, though the market ended the year on a negative note, hampered by policy
concerns, including those related to the appointment of a new Economic Minister
and talk of price controls as a means to fight inflation.
PERFORMANCE: PARTICIPATING IN A MULTI-SECTOR RALLY
The Fund had a solid gain but modestly trailed its benchmark for the year. This
in part reflected lower returns from the Fund's small allocation to private
equity (approximately 1% of its assets as of December 31, 2005), despite the
fact that liquidity conditions have improved in the private market. From a broad
sector perspective, the Fund's energy and telecommunications stocks had gains
but modestly lagged their respective components of the benchmark, while its
industrials and consumer discretionary holdings were positive contributors to
both absolute and relative performance. Within health care, we owned a Brazilian
medical diagnostics company that had a large gain.
THE PORTFOLIO AND OUTLOOK
We continue to view Latin America as compelling from an equity perspective. For
one, throughout the past year a buoyant new issue market has given many
opportunities to invest in a range of new companies, in emerging sectors such as
transportation (rail and air), homebuilding and real estate, health care,
insurance and retail. There has also been a deepening of the free float of
several existing publicly traded companies. On balance, these opportunities have
been beneficial for returns.
In the portfolio, we increased our weighting in Brazil over the course of the
year, mostly at the expense of Mexico and Chile, though late in the year we
raised our exposure to Chile, narrowing the degree of our underweighted
position. Chilean stocks have lagged the region, and valuations, which
historically have been relatively high, are now in some sectors in line with or
below valuations in Mexico and the country's economic fundamentals remain strong
in our view. We have reduced our positions in Argentina and Venezuela, based on
our more negative outlook on the prospects for further market oriented reform
and the potential for government interference in the market economy.
Latin American equities have now had an extended period of strong performance,
and as a result they may be susceptible to profit-taking on any negative news.
That said, we continue to see upside potential over the next year,
1
based on overall healthy fundamentals in terms of economic growth and earnings
and cash flow improvements. The global macro backdrop remains supportive: fund
flows have been healthy and risk appetite has increased lately. Barring a spike
in US bond yields or other external shocks, the conditions for emerging markets
in general over the intermediate term seem supportive.
For the time being, the markets appear to be shrugging off political concerns;
however, we believe that, with Presidential elections coming in many Latin
American countries over the next few months, including Brazil and Mexico,
greater market volatility could be in store. Our stock positioning remains
relatively defensive as a result.
As we anticipated in our last Annual Report, the Fund is now registered in
Chile, thereby permitting institutional investors who are domiciled and
regulated in that country to invest in the Fund. We believe that this measure
helps to increase potential demand for the Fund's shares. It is our
understanding that, at this time, Chilean pension funds (AFP's) have invested
the maximum amount in non-Chilean equity that is permitted under Chilean
regulation. These limitations imposed by this cap and other regulatory caps vary
according to relative prices of financial assets as well as inflows of capital
from individual contributors to pension funds.
Respectfully,
/s/ Matthew J.K. Hickman /s/ Steven B. Plump
Matthew J.K. Hickman Steven B. Plump
Chief Investment Officer** Chief Executive Officer and President***
INTERNATIONAL INVESTING ENTAILS SPECIAL RISK CONSIDERATIONS, INCLUDING CURRENCY
FLUCTUATIONS, LOWER LIQUIDITY, ECONOMIC AND POLITICAL RISKS, AND DIFFERENCES IN
ACCOUNTING METHODS; THESE RISKS ARE GENERALLY HEIGHTENED FOR EMERGING-MARKET
INVESTMENTS.
IN ADDITION TO HISTORICAL INFORMATION, THIS REPORT CONTAINS FORWARD-LOOKING
STATEMENTS, WHICH MAY CONCERN, AMONG OTHER THINGS, DOMESTIC AND FOREIGN MARKET,
INDUSTRY AND ECONOMIC TRENDS AND DEVELOPMENTS AND GOVERNMENT REGULATION AND
THEIR POTENTIAL IMPACT ON THE FUND'S INVESTMENT PORTFOLIO. THESE STATEMENTS ARE
SUBJECT TO RISKS AND UNCERTAINTIES AND ACTUAL TRENDS, DEVELOPMENTS AND
REGULATIONS IN THE FUTURE AND THEIR IMPACT ON THE FUND COULD BE MATERIALLY
DIFFERENT FROM THOSE PROJECTED, ANTICIPATED OR IMPLIED. THE FUND HAS NO
OBLIGATION TO UPDATE OR REVISE FORWARD-LOOKING STATEMENTS.
- ----------
*The Morgan Stanley Capital International Latin America Index is a free
float-adjusted market capitalization index that is designed to measure
equity-market performance in Latin America that includes reinvestment of
dividends (net of taxes). It is the exclusive property of Morgan Stanley Capital
International Inc. Investors cannot invest directly in an index.
**Matthew J.K. Hickman, Director, is a portfolio manager specializing in Latin
American equities and is primarily responsible for management of the Fund's
assets. He joined in 2003 from Compass Group Investment Advisors, where he was
general manager of the private wealth management division based in Santiago,
Chile. Previously, he was a financial advisor in Credit Suisse First Boston's
Private Client Services channel; an equity analyst focusing on Latin American
telecommunications companies and several Latin American country markets at ABN
AMRO, Lehman Brothers, Bear, Stearns and James Capel; and an equity analyst and
member of the management team for the Five Arrows Chile Fund at Rothschild Asset
Management. Mr. Hickman holds a BA in modern languages from Cambridge University
and a diploma in corporate finance from London Business School. He is fluent in
Spanish, Portuguese and French. He is also the Chief Investment Officer of The
Chile Fund, Inc.
***Steven B. Plump is a Managing Director of Credit Suisse Asset Management, LLC
("Credit Suisse") and CEO/President of the Fund. He joined Warburg Pincus Asset
Management ("WPAM") in 1995 and came to Credit Suisse in 1999 when it acquired
WPAM.
2
THE LATIN AMERICA EQUITY FUND, INC.
PORTFOLIO SUMMARY - AS OF DECEMBER 31, 2005 (UNAUDITED)
GEOGRAPHIC ASSET BREAKDOWN
[CHART]
AS A PERCENT OF NET ASSETS
<Table>
<Caption>
DECEMBER 31, 2005 DECEMBER 31, 2004
Argentina 1.62% 1.75%
Brazil 57.46% 52.02%
Chile 7.44% 8.45%
Colombia 1.67% 0.00%
Latin America 0.38% 0.82%
Mexico 27.29% 30.78%
Panama 0.00% 0.83%
Peru 0.91% 1.52%
Venezuela 0.18% 1.21%
Global 0.77% 1.01%
Cash and Other Assets 2.28% 1.61%
</Table>
SECTOR ALLOCATION
[CHART]
AS A PERCENT OF NET ASSETS
<Table>
<Caption>
DECEMBER 31, 2005 DECEMBER 31, 2004
Airlines 2.29% 0.93%
Banking 9.38% 9.69%
Broadcast, Radio & Television 3.22% 0.93%
Cellular Telecommunications 7.59% 11.44%
Cement 2.80% 2.12%
Diversified Operations 2.84% 1.97%
Electric-Integrated 2.36% 3.59%
Food & Beverages 7.61% 5.12%
Mining 9.38% 11.86%
Oil & Natural Gas 14.04% 11.11%
Real Estate Operations/Development 2.96% 1.91%
Steel 2.36% 2.00%
Telephone-Integrated 6.93% 14.97%
Other 26.24% 22.37%
</Table>
3
<Page>
TOP 10 HOLDINGS, BY ISSUER
<Table>
<Caption>
PERCENT OF
HOLDING SECTOR COUNTRY NET ASSETS
------------------------------------------------------------------------------------------------
1. Petroleo Brasileiro S.A. Oil & Natural Gas Brazil 13.6
2. Companhia Vale do Rio Doce Mining Brazil 8.9
3. America Telecom, S.A. de C.V. Cellular Telecommunications Mexico 4.0
4. Tele Norte Leste Participacoes S.A. Telephone-Integrated Brazil 3.9
5. Uniao de Bancos Brasileiros S.A. Banking Brazil 3.2
6. Grupo Televisa S.A. Broadcast, Radio & Television Mexico 3.0
7. Cemex, S.A. de C.V. Cement Mexico 2.8
8. America Movil, S.A. de C.V. Cellular Telecommunications Mexico 2.7
9. Tam S.A. Airlines Brazil 1.9
10. Banco Itau Holding Financeira S.A. Banking Brazil 1.8
</Table>
4
<Page>
THE LATIN AMERICA EQUITY FUND, INC.
SCHEDULE OF INVESTMENTS - DECEMBER 31, 2005
<Table>
<Caption>
NO. OF
DESCRIPTION SHARES VALUE
- --------------------------------------------------------------------------------
EQUITY OR EQUITY-LINKED SECURITIES-97.72%
ARGENTINA-1.62%
AGRICULTURE-0.32%
Cresud S.A.C.I.F. y A., ADR 64,700 $ 707,171
------------
BANKING-0.43%
Banco Hipotecario, ADR+ 250,300 967,710
------------
OIL & NATURAL GAS-0.49%
Tenaris S.A., ADR 9,500 1,087,750
------------
REAL ESTATE DEVELOPMENT-0.18%
IRSA Inversiones y Representaciones
S.A., GDR+ 33,900 409,512
------------
TELEPHONE-INTEGRATED-0.20%
Nortel Inversora S.A.,
PNB, ADR+ 45,700 441,005
------------
TOTAL ARGENTINA
(Cost $3,122,967) 3,613,148
------------
BRAZIL-57.46%
AEROSPACE/DEFENSE-EQUIPMENT-0.91%
Empresa Brasileira de Aeronautica
S.A., ADR 52,100 2,037,110
------------
AIRLINES-1.89%
Tam S.A., PN+ 221,900 4,218,523
------------
BANKING-5.64%
Banco do Brasil S.A. 31,600 570,978
Banco Itau Holding Financeira
S.A., PN 166,600 4,016,091
Banco Nossa Caixa S.A.+ 57,300 856,249
Uniao de Bancos Brasileiros
S.A.,GDR 112,100 7,126,197
------------
12,569,515
------------
BOTTLING-1.78%
Companhia de Bebidas das
Americas, ADR 22,600 739,020
Companhia de Bebidas das
Americas, PN, ADR 84,800 3,226,640
------------
3,965,660
------------
CELLULAR TELECOMMUNICATIONS-0.92%
Celular CRT Participacoes S.A. 1,160 $ 27,318
Telesp Celular Participacoes
S.A., ADR+ 533,757 2,017,601
------------
2,044,919
------------
COSMETICS & TOILETRIES-0.43%
Natura Cosmeticos S.A. 21,500 948,007
------------
DIVERSIFIED OPERATIONS-2.36%
Bradespar S.A., PN 96,300 2,445,125
Investimentos Itau S.A., PN 886,822 2,809,883
------------
5,255,008
------------
E-COMMERCE/PRODUCTS-0.41%
Sunmarino SA+ 51,000 906,230
------------
ELECTRIC-GENERATION-1.98%
AES Tiete S.A., PN 155,712,100 3,393,597
Tractebel Energia S.A. 158,500 1,021,377
------------
4,414,974
------------
ELECTRIC-INTEGRATED-1.32%
Companhia Energetica de Minas
Gerais, ADR 28,000 1,032,080
Companhia Energetica de Minas
Gerais, PN 14,500,000 589,809
EDP-Energias do Brasil S.A.+ 112,700 1,321,710
------------
2,943,599
------------
FOOD-RETAIL-0.27%
Perdigao S.A., PN 17,700 597,958
------------
MEDICAL LABS & TESTING SERVICES-0.76%
Diagnosticos da America S.A.+ 90,700 1,689,338
------------
MINING-8.85%
Companhia Vale do Rio Doce,
ADR, PNA 544,200 19,727,250
------------
OIL & NATURAL GAS-13.55%
Petroleo Brasileiro S.A., ADR 469,300 30,208,841
------------
</Table>
5
<Page>
<Table>
<Caption>
NO. OF
DESCRIPTION SHARES VALUE
- --------------------------------------------------------------------------------
PAPER & RELATED PRODUCTS-0.73%
Aracruz Celulose S.A., ADR 26,300 $ 1,052,263
Votorantim Celulose e Papel
S.A., ADR 47,750 586,847
------------
1,639,110
------------
PETROCHEMICALS-0.58%
Braskem S.A., PNA 157,600 1,282,124
------------
PUBLIC THOROUGHFARES-1.22%
Obrascon Huarte Lain Brasil
S.A.+ 250,200 2,722,150
------------
REAL ESTATE OPERATIONS/DEVELOPMENT-0.59%
Cyrela Brazil Realty S.A.
Empreendimentos e
Participacoes 96,500 1,322,201
------------
STEEL-2.36%
Arcelor Brasil SA 48,284 578,870
Companhia Siderurgica Nacional
S.A., ON 82,900 1,785,429
Gerdau S.A., PN 48,000 807,707
Usinas Siderurgicas de Minas
Gerais S.A., PNA 88,100 2,097,350
------------
5,269,356
------------
SUGAR-1.02%
Cosan SA Industria e Comercio+ 77,600 2,263,707
------------
TELEPHONE-INTEGRATED-5.87%
Brasil Telecom Participacoes
S.A. 143,300,000 1,457,850
Telecomunicacoes de Sao Paulo
S.A., PN 78,800 1,617,838
Tele Norte Leste Participacoes
S.A., ADR 260,000 4,659,200
Tele Norte Leste Participacoes
S.A., ON 173,136 3,951,252
Telemar Norte Leste S.A., PNA 51,200 1,392,079
------------
13,078,219
------------
TEXTILES-1.09%
Companhia Tecidos Norte de
Minas S.A., PN 26,500,000 2,428,174
------------
TOBACCO-0.70%
Souza Cruz S.A. 125,000 $ 1,552,130
------------
TRANSPORTATION-1.15%
All America Latina Logistica 60,000 2,562,620
------------
WEB PORTALS/ISP-0.44%
Universo Online SA+ 115,700 975,932
------------
UTILITIES-0.64%
Companhia de Saneamento
Basico do Estado de
Sao Paulo, ON 21,100,000 1,418,412
------------
Total Brazil
(Cost $76,045,160) 128,041,067
------------
CHILE-7.44%
BANKING-1.09%
Banco de Chile 16,888,404 1,137,877
Banco Santander Chile S.A. 30,613,969 1,291,401
------------
2,429,278
------------
DIVERSIFIED OPERATIONS-0.48%
Empresas Copec S.A. 123,000 1,062,933
------------
ELECTRIC-INTEGRATED-1.04%
Empresa Nacional de Electricidad
S.A. 1,474,568 1,494,582
Enersis S.A. 3,780,000 826,794
------------
2,321,376
------------
FOOD & BEVERAGES-1.96%
Compania Cervecerias Unidas
S.A. 197,880 1,004,761
Compania Cervecerias Unidas
S.A., ADR 50,400 1,271,088
Embotelladora Andina S.A.,
ADR, Series B 79,100 1,102,654
Embotelladora Andina
S.A., PNA 294,613 661,664
Embotelladora Andina
S.A., PNB 140,000 333,561
------------
4,373,728
------------
</Table>
6
<Page>
<Table>
<Caption>
NO. OF
DESCRIPTION SHARES/UNITS VALUE
- --------------------------------------------------------------------------------
FOOD-RETAIL-0.25%
Cencosud S.A. 280,000 $ 555,024
------------
PAPER & RELATED PRODUCTS-0.56%
Empresas CMPC S.A. 50,000 1,240,113
------------
RETAIL-MAJOR DEPARTMENT STORES-0.25%
S.A.C.I. Falabella, S.A. 205,000 564,496
------------
TELEPHONE-INTEGRATED-0.36%
Compania de Telecomunicaciones
de Chile S.A., Series A 367,916 804,738
------------
WATER-1.45%
Inversiones Aguas Metropolitanas
S.A., ADR+ ++ 192,000 3,223,296
------------
TOTAL CHILE
(Cost $13,629,199) 16,574,982
------------
COLOMBIA-1.67%
BANKING-0.73%
BanColombia S.A., ADR 56,300 1,623,129
------------
INVESTMENT COMPANIES-0.94%
Suramericana de Inversiones
S.A. 244,100 2,098,821
------------
TOTAL COLOMBIA
(Cost $1,922,465) 3,721,950
------------
LATIN AMERICA-0.38%
VENTURE CAPITAL-0.38%
J.P. Morgan Latin America
Capital Partners (Cayman),
L.P.++^^ 914,628 379,479
J.P. Morgan Latin America
Capital Partners (Delaware),
L.P.++^^# 1,466,528 464,244
------------
TOTAL LATIN AMERICA
(Cost $1,360,662) 843,723
------------
<Caption>
NO. OF
DESCRIPTION SHARES VALUE
- --------------------------------------------------------------------------------
MEXICO-27.29%
AIRLINES-0.39%
Cintra, S.A. de C.V.+ 2,290,700 $ 878,583
------------
BANKING-0.65%
Grupo Financiero Inbursa,
S.A. de C.V., ON 847,000 1,444,359
------------
BROADCAST, RADIO & TELEVISION-3.22%
Grupo Radio Centro S.A. de
C.V., ADR+ 57,800 402,288
Grupo Televisa S.A., ADR 84,200 6,778,100
------------
7,180,388
------------
BUILDING-HEAVY CONSTRUCTION-0.38%
Empresas ICA S.A. de C.V.+ 347,766 849,992
------------
CELLULAR TELECOMMUNICATIONS-6.67%
America Movil, S.A. de C.V.,
Series L, ADR 206,300 6,036,338
America Telecom, S.A. de C.V.,
Series A1 Shares+ 1,815,500 8,823,504
------------
14,859,842
------------
CEMENT-2.80%
Cemex, S.A. de C.V., ADR 105,110 6,236,176
------------
ENGINEERING & CONSTRUCTION-1.35%
Corporacion GEO, S.A. de C.V.,
Series B+ 854,500 3,012,296
------------
FOOD & BEVERAGES-5.65%
Embotelladoras Arca S.A.,
Nominative Shares 1,270,200 3,104,558
Fomento Economico Mexicano,
S.A. de C.V., ADR 54,012 3,916,410
Gruma S.A., Class B 1,183,300 3,837,676
Grupo Bimbo, S.A. de C.V.,
Series A 496,100 1,725,541
------------
12,584,185
------------
FOOD-RETAIL-0.45%
Controladora Comercial Mexicana
S.A. de C.V. 658,500 1,007,777
------------
</Table>
7
<Page>
<Table>
<Caption>
NO. OF
DESCRIPTION SHARES VALUE
- --------------------------------------------------------------------------------
METAL-DIVERSIFIED-1.20%
Grupo Mexico SA de C.V.,
Class B+ 1,144,500 $ 2,668,221
------------
MINING-0.27%
Baja Mining Corp.+ 1,520,200 611,645
------------
REAL ESTATE DEVELOPMENT-2.18%
Consorcio ARA, S.A. de C.V. 384,500 1,680,752
Desarrolladora Homex S.A. de
C.V., ADR+ 33,800 1,036,984
Urbi, Desarrollos Urbanos,
S.A. de C.V.+ 309,800 2,140,539
------------
4,858,275
------------
RETAIL-MAJOR DEPARTMENT STORES-1.57%
Wal-Mart de Mexico, S.A. de C.V.,
Series V 395,830 2,195,407
Wal-Mart de Mexico, S.A. de C.V.,
Series V, ADR 23,677 1,313,207
------------
3,508,614
------------
TELEPHONE-INTEGRATED-0.51%
Telefonos de Mexico, S.A. de C.V.,
Class L, ADR 45,700 1,127,876
------------
TOTAL MEXICO
(Cost $41,186,657) 60,828,229
------------
PERU-0.91%
BANKING-0.66%
Credicorp Limited 64,300 1,465,397
------------
MINING-0.25%
Compania de Minas
Buenaventura S.A.u., ADR 20,000 566,000
------------
TOTAL PERU
(Cost $1,667,272) 2,031,397
------------
VENEZUELA-0.18%
BANKING-0.18%
Mercantil Servicios Financieros,
C.A., ADR
(Cost $399,748) 103,600 408,619
------------
GLOBAL-0.77%
VENTURE CAPITAL-0.77%
Emerging Markets
Ventures I L.P.++^^#
(Cost $1,564,944) 2,226,890 $ 1,710,986
------------
TOTAL EQUITY OR EQUITY-LINKED
SECURITIES (Cost $140,899,074) 217,774,101
------------
SHORT-TERM INVESTMENTS-3.47%
CHILEAN MUTUAL FUND-0.02%
Fondo Mutuo Security Check
(Cost $49,853) 8,931 50,901
------------
GRAND CAYMAN-3.45%
<Caption>
PRINCIPAL
AMOUNTS (000S)
--------------
HSBC Bank USA., overnight
deposit, 3.05%, 1/03/06*
(Cost $7,671,839) $ 7,672 7,671,839
------------
TOTAL SHORT-TERM INVESTMENTS
(Cost $7,721,692) 7,722,740
------------
TOTAL INVESTMENTS-101.19%
(Cost $148,620,766) (Notes B,E,G) 225,496,841
------------
LIABILITIES IN EXCESS OF CASH AND
OTHER ASSETS-(1.19)% (2,645,158)
------------
NET ASSETS-100.00% $222,851,683
============
</Table>
- ----------
+ Security is non-income producing.
++ SEC Rule 144A security. Such securities are traded only among "qualified
institutional buyers."
^^ Restricted security, not readily marketable; security is valued at fair
value as determined in good faith by, or under the directon of, the Board
of Directors under procedures established by the Board of Directors. (See
Notes B and H)
# As of December 31, 2005 the aggregate amount of open commitments for the
Fund is $1,017,492. (See Note H)
* Variable rate account. Rate resets on a daily basis: amounts are available
on the same business day.
ADR American Depository Receipts.
GDR Global Depository Receipts.
ON Ordinary Shares.
PN Preferred Shares.
PNA Preferred Shares, Class A.
PNB Preferred Shares, Class B.
See accompanying notes to financial statements.
8
<Page>
THE LATIN AMERICA EQUITY FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES - DECEMBER 31, 2005
<Table>
ASSETS
Investments, at value (Cost $148,620,766) (Notes B,E,G) $ 225,496,841
Cash (including $1,101,917 of foreign currencies with a cost of $1,104,798) 1,102,829
Receivables:
Dividends 1,172,511
Investments sold 788,236
Prepaid expenses 2,274
---------------
Total Assets 228,562,691
---------------
LIABILITIES
Payables:
Dividends and distributions (Note B) 4,931,347
Investment advisory fees (Note C) 445,999
Investments purchased 129,791
Administration fees (Note C) 48,108
Directors' fees 2,271
Chilean taxes 66,132
Other accrued fees 87,360
---------------
Total Liabilities 5,711,008
---------------
NET ASSETS (applicable to 6,322,240 shares of common stock outstanding) (Note D) $ 222,851,683
===============
NET ASSETS CONSIST OF
Capital stock, $0.001 par value; 6,322,240 shares issued and outstanding
(100,000,000 shares authorized) $ 6,322
Paid-in capital 140,606,867
Undistributed net investment income 179,490
Accumulated net realized gain on investments and foreign
currency related transactions 5,180,648
Net unrealized appreciation in value of investments and translation of other
assets and liabilities denominated in foreign currencies 76,878,356
---------------
Net assets applicable to shares outstanding $ 222,851,683
===============
NET ASSET VALUE PER SHARE ($222,851,683 DIVIDED BY 6,322,240) $ 35.25
===============
MARKET PRICE PER SHARE $ 30.46
===============
</Table>
See accompanying notes to financial statements.
9
<Page>
THE LATIN AMERICA EQUITY FUND, INC.
STATEMENT OF OPERATIONS - FOR THE YEAR ENDED DECEMBER 31, 2005
<Table>
INVESTMENT INCOME
Income (Note B):
Dividends $ 6,631,801
Interest 33,879
Net investment income allocated from partnerships 61,315
Less: Foreign taxes withheld (450,656)
---------------
Total Investment Income 6,276,339
---------------
Expenses:
Investment advisory fees (Note C) 1,513,476
Administration fees (Note C) 230,659
Custodian fees 224,518
Audit and tax fees 69,513
Accounting fees 56,931
Legal fees 44,342
Directors' fees 41,273
Printing (Note B) 38,001
NYSE listing fees 23,685
Shareholder servicing fees 19,199
Insurance 5,877
Other 11,703
Brazilian taxes (Note B) 72,678
Chilean taxes (Note B) 63,277
---------------
Total Expenses 2,415,132
---------------
Net Investment Income 3,861,207
---------------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS AND
FOREIGN CURRENCY RELATED TRANSACTIONS
Net realized gain/(loss) from:
Investments 46,028,196
Foreign currency related transactions (295,888)
Net change in unrealized appreciation in value of investments and translation
of other assets and liabilities denominated in foreign currencies 23,975,296
---------------
Net realized and unrealized gain on investments and foreign
currency related transactions 69,707,604
---------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 73,568,811
===============
</Table>
See accompanying notes to financial statements.
10
<Page>
THE LATIN AMERICA EQUITY FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
<Table>
<Caption>
FOR THE YEARS ENDED
DECEMBER 31,
-------------------------------
2005 2004
-------------- --------------
INCREASE IN NET ASSETS
Operations:
Net investment income $ 3,861,207 $ 2,852,033
Net realized gain on investments and foreign currency related
transactions 45,732,308 19,125,891
Net change in unrealized appreciation in value of investments and
translation of other assets and liabilities denominated in foreign currencies 23,975,296 22,966,932
-------------- --------------
Net increase in net assets resulting from operations 73,568,811 44,944,856
-------------- --------------
Dividends and distributions to shareholders:
Net investment income (3,161,120) (2,908,230)
Net realized gain on investments (1,770,227) --
-------------- --------------
Total dividends and distributions to shareholders (4,931,347) (2,908,230)
-------------- --------------
Total increase in net assets 68,637,464 42,036,626
-------------- --------------
NET ASSETS
Beginning of year 154,214,219 112,177,593
-------------- --------------
End of year $ 222,851,683* $ 154,214,219
============== ==============
</Table>
- ----------
* Includes undistributed net investment income of $179,490.
See accompanying notes to financial statements.
11
<Page>
THE LATIN AMERICA EQUITY FUND, INC.
FINANCIAL HIGHLIGHTS^
Contained below is per share operating performance data for a share of common
stock outstanding, total investment return, ratios to average net assets and
other supplemental data for each year indicated. This information has been
derived from information provided in the financial statements and market price
data for the Fund's shares.
<Table>
<Caption>
FOR THE YEARS ENDED DECEMBER 31,
---------------------------------------------------------------
2005 2004 2003 2002
------------ ------------ ------------ ------------
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of year $ 24.39 $ 17.74 $ 11.55 $ 15.06
------------ ------------ ------------ ------------
Net investment income/(loss) 0.61 0.45+ 0.34+ 0.01**
Net realized and unrealized
gain/(loss) on investments
and foreign currency related
transactions 11.03 6.66 5.99 (3.41)
------------ ------------ ------------ ------------
Net increase/(decrease) in net assets
resulting from operations 11.64 7.11 6.33 (3.40)
------------ ------------ ------------ ------------
Dividends and distributions to shareholders:
Net investment income (0.50) (0.46) (0.14) (0.21)
Net realized gain on investments and
foreign currency related transactions (0.28) -- -- --
------------ ------------ ------------ ------------
Total dividends and distributions to
shareholders (0.78) (0.46) (0.14) (0.21)
------------ ------------ ------------ ------------
Anti-dilutive impact due to capital
shares tendered or repurchased -- -- -- 0.10#
------------ ------------ ------------ ------------
Net asset value, end of year $ 35.25 $ 24.39 $ 17.74 $ 11.55
============ ============ ============ ============
Market value, end of year $ 30.46 $ 21.64 $ 15.26 $ 9.67
============ ============ ============ ============
Total investment return (a) 44.06% 45.04% 59.15% (18.83)%
============ ============ ============ ============
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year (000
omitted) $ 222,852 $ 154,214 $ 112,178 $ 73,045
Ratio of expenses to average net
assets (b) 1.33% 1.41% 1.37% 3.06%
Ratio of expenses to average net
assets, excluding fee waivers 1.33% 1.41% 1.37% 3.06%
Ratio of expenses to average net
assets, excluding taxes 1.26% 1.40% 1.49% 1.52%
Ratio of net investment
income/(loss) to average net assets 2.13% 2.36% 2.49%(c) 0.21%
Portfolio turnover rate 75.60% 69.80% 62.62% 75.28%
</Table>
- ----------
^ Per share amounts prior to November 10, 2000 have been restated to
reflect a conversion factor of 0.9175 for shares issued in connection with
the merger of The Latin America Investment Fund, Inc. and The Latin America
Equity Fund, Inc.
* Based on actual shares outstanding on November 21, 2001 (prior to the 2001
tender offer) and December 31, 2001.
** Based on actual shares outstanding on November 6, 2002 (prior to the 2002
tender offer) and December 31, 2002.
+ Based on average shares outstanding.
^^ Includes a $0.01 per share decrease to the Fund's net asset value per share
resulting from the dilutive impact of shares issued pursuant to the Fund's
automatic dividend reinvestment program.
# Impact of the Fund's self-tender program.
See accompanying notes to financial statements.
12
<Page>
<Table>
<Caption>
FOR THE YEARS ENDED DECEMBER 31,
---------------------------------------------------------------
2001 2000 1999 1998
------------ ------------ ------------ ------------
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of year $ 16.60 $ 18.57 $ 10.96 $ 18.77
------------ ------------ ------------ ------------
Net investment income/(loss) 0.41* (0.11)+ 0.07+ 0.16
Net realized and unrealized
gain/(loss) on investments
and foreign currency related
transactions (1.50) (2.44) 7.07 (7.85)^^
------------ ------------ ------------ ------------
Net increase/(decrease) in net assets
resulting from operations (1.09) (2.55) 7.14 (7.69)
------------ ------------ ------------ ------------
Dividends and distributions to shareholders:
Net investment income (0.57) (0.08) -- (0.12)
Net realized gain on investments and
foreign currency related transactions -- -- -- --
------------ ------------ ------------ ------------
Total dividends and distributions to
shareholders (0.57) (0.08) -- (0.12)
------------ ------------ ------------ ------------
Anti-dilutive impact due to capital
shares tendered or repurchased 0.12# 0.66 0.47 --
------------ ------------ ------------ ------------
Net asset value, end of year $ 15.06 $ 16.60 $ 18.57 $ 10.96
============ ============ ============ ============
Market value, end of year $ 12.15 $ 12.875 $ 13.76 $ 7.834
============ ============ ============ ============
Total investment return (a) (1.07)% (5.87)% 75.65% (46.63)%
============ ============ ============ ============
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year (000
omitted) $ 112,009 $ 145,281 $ 123,262 $ 86,676
Ratio of expenses to average net
assets (b) 1.51% 2.13% 2.14% 2.41%
Ratio of expenses to average net
assets, excluding fee waivers 1.51% 2.19% 2.22% 2.60%
Ratio of expenses to average net
assets, excluding taxes 1.40% 2.03% 2.05% 1.77%
Ratio of net investment
income/(loss) to average net assets 2.52% (0.55)% 0.46% 1.12%
Portfolio turnover rate 101.73% 125.83% 161.71% 142.35%
<Caption>
FOR THE YEARS ENDED DECEMBER 31,
--------------------------------
1997 1996
------------ ------------
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of year $ 18.41 $ 16.27
Net investment income/(loss) 0.16 0.21
Net realized and unrealized
gain/(loss) on investments
and foreign currency related
transactions 2.01 2.00
------------ ------------
Net increase/(decrease) in net assets
resulting from operations 2.17 2.21
------------ ------------
Dividends and distributions to shareholders:
Net investment income (0.17) 0.07
Net realized gain on investments and
foreign currency related transactions (1.64) --
------------ ------------
Total dividends and distributions to
shareholders (1.81) (0.07)
------------ ------------
Anti-dilutive impact due to capital
shares tendered or repurchased -- --
------------ ------------
Net asset value, end of year $ 18.77 $ 18.41
============ ============
Market value, end of year $ 14.918 $ 15.259
============ ============
Total investment return (a) 10.29% 9.18%
============ ============
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year (000
omitted) $ 148,130 $ 145,230
Ratio of expenses to average net
assets (b) 1.89% 1.69%
Ratio of expenses to average net
assets, excluding fee waivers 2.02% 1.80%
Ratio of expenses to average net
assets, excluding taxes 1.65% --
Ratio of net investment
income/(loss) to average net assets 0.77% 1.16%
Portfolio turnover rate 111.83% 43.22%
</Table>
- ----------
(a) Total investment return at market value is based on the changes in market
price of a share during the year and assumes reinvestment of dividends and
distributions, if any, at actual prices pursuant to the Funds dividend
reinvestment program.
(b) Ratios reflect actual expenses incurred by the Fund. Amounts are net of fee
waivers and inclusive of taxes.
(c) Ratio includes the effect of a reversal of Chilean repatriation tax
accrual; excluding the reversal, the ratio would have been 2.36%.
13
<Page>
THE LATIN AMERICA EQUITY FUND, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE A. ORGANIZATION
The Latin America Equity Fund, Inc. (the "Fund") is registered under the
Investment Company Act of 1940, as amended, as a closed-end, non-diversified
management investment company.
NOTE B. SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES: The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
("GAAP") requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the reported amounts
of revenue and expenses during the reporting period. Actual results could differ
from those estimates.
SECURITY VALUATION: The net asset value of the Fund is determined daily as of
the close of regular trading on the New York Stock Exchange, Inc. (the
"Exchange") on each day the Exchange is open for business. The Fund's equity
investments are valued at market value, which is generally determined using the
closing price on the exchange or market on which the security is primarily
traded at the time of valuation (the "Valuation Time"). If no sales are
reported, equity investments are generally valued at the most recent bid
quotation as of the Valuation Time or at the lowest ask quotation in the case of
a short sale of securities. Debt securities with a remaining maturity greater
than 60 days are valued in accordance with the price supplied by a pricing
service, which may use a matrix, formula or other objective method that takes
into consideration market indices, yield curves and other specific adjustments.
Debt obligations that will mature in 60 days or less are valued on the basis of
amortized cost, which approximates market value, unless it is determined that
this method would not represent fair value. Investments in mutual funds are
valued at the mutual fund's closing net asset value per share on the day of
valuation.
Securities and other assets for which market quotations are not readily
available, or whose values have been materially affected by events occurring
before the Fund's Valuation Time, but after the close of the securities primary
market, are valued at fair value as determined in good faith by, or under the
direction of, the Board of Directors under procedures established by the Board
of Directors. The Fund may utilize a service provided by an independent third
party which has been approved by the Board of Directors to fair value certain
securities. At December 31, 2005, the Fund held 1.15% of its net assets in
securities valued at fair value as determined in good faith under procedures
established by the Board of Directors with an aggregate cost of $2,925,606 and
fair value of $2,554,709. The Fund's estimate of fair value assumes a willing
buyer and a willing seller neither acting under a compulsion to buy or sell.
Although these securities may be resold in privately negotiated transactions,
the prices realized on such sales could differ from the prices originally paid
by the Fund or the current carrying values, and the difference could be
material.
SHORT-TERM INVESTMENT: The Fund sweeps available cash into a short-term time
deposit available through Brown Brothers Harriman & Co. the Fund's custodian.
The short-term time deposit is a variable rate account classified as a
short-term investment.
INVESTMENT TRANSACTIONS AND INVESTMENT INCOME: Investment transactions are
accounted for on a trade date basis. The cost of investments sold is determined
by use of the specific identification method for both financial reporting and
U.S. income tax purposes. Interest income is accrued as earned; dividend income
is recorded on the ex-dividend date.
TAXES: No provision is made for U.S. income or excise taxes as it is the Fund's
intention to continue to qualify as a regulated investment company and to make
the requisite distributions to its shareholders sufficient to
14
<Page>
relieve it from all or substantially all U.S. income and excise taxes.
Income received by the Fund from sources within Latin America may be subject to
withholding and other taxes imposed by such countries. Also, certain Latin
American countries impose taxes on funds remitted or repatriated from such
countries.
For Chilean securities the Fund accrues foreign taxes on realized gains and
repatriation taxes in an amount equal to what the Fund would owe if the
securities were sold and the proceeds repatriated on the valuation date as a
liability and reduction of realized/unrealized gains. Taxes on foreign income
are recorded when the related income is recorded. For the year ended December
31, 2005, the Fund accrued $63,277 of such expense.
FOREIGN CURRENCY TRANSLATIONS: The books and records of the Fund are maintained
in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on
the following basis:
(I) market value of investment securities, assets and liabilities at the
valuation date rate of exchange; and
(II) purchases and sales of investment securities, income and expenses at
the relevant rates of exchange prevailing on the respective dates of
such transactions.
The Fund does not isolate that portion of gains and losses on investments in
equity securities which is due to changes in the foreign exchange rates from
that which is due to changes in market prices of equity securities. Accordingly,
realized and unrealized foreign currency gains and losses with respect to such
securities are included in the reported net realized and unrealized gains and
losses on investment transactions balances.
The Fund reports certain foreign currency related transactions and foreign taxes
withheld on security transactions as components of realized gains for financial
reporting purposes, whereas such foreign currency related transactions are
treated as ordinary income for U.S. federal income tax purposes.
Net unrealized currency gains or losses from valuing foreign currency
denominated assets and liabilities at period end exchange rates are reflected as
a component of net unrealized appreciation/depreciation in value of investments,
and translation of other assets and liabilities denominated in foreign
currencies.
Net realized foreign exchange gains or losses represent foreign exchange gains
and losses from transactions in foreign currencies and forward foreign currency
contracts, exchange gains or losses realized between the trade date and
settlement dates on security transactions, and the difference between the
amounts of interest and dividends recorded on the Fund's books and the U.S.
dollar equivalent of the amounts actually received.
DISTRIBUTIONS OF INCOME AND GAINS: The Fund distributes at least annually to
shareholders substantially all of its net investment income and net realized
short-term capital gains, if any. The Fund determines annually whether to
distribute any net realized long-term capital gains in excess of net realized
short-term capital losses, including capital loss carryovers, if any. An
additional distribution may be made to the extent necessary to avoid the payment
of a 4% U.S. federal excise tax. Dividends and distributions to shareholders are
recorded by the Fund on the ex-dividend date.
The character of distributions made during the year from net investment income
or net realized gains may differ from their ultimate characterization for U.S.
income tax purposes due to U.S. generally accepted accounting principles/tax
differences in the character of income and expense recognition.
15
<Page>
PARTNERSHIP ACCOUNTING POLICY: The Fund records its pro-rata share of the
income/(loss) and capital gains/(losses) allocated from the underlying
partnerships and adjusts the cost of the underlying partnerships accordingly.
These amounts are included in the Fund's Statement of Operations.
OTHER: The Fund invests in securities of foreign countries and governments which
involve certain risks in addition to those inherent in domestic investments.
Such risks generally include, among others, currency risk (fluctuations in
currency exchange rates), information risk (key information may be inaccurate or
unavailable) and political risk (expropriation, nationalization or the
imposition of capital or currency controls or punitive taxes). Other risks of
investing in foreign securities include liquidity and valuation risks.
Some countries require governmental approval for the repatriation of investment
income, capital or the proceeds of sales of securities by foreign investors. In
addition, if there is a deterioration in a country's balance of payments or for
other reasons, a country may impose temporary restrictions on foreign capital
remittances abroad. Amounts repatriated prior to the end of specified periods
may be subject to taxes as imposed by a foreign country.
The Latin American securities markets are substantially smaller, less liquid and
more volatile than the major securities markets in the United States. A high
proportion of the securities of many companies in Latin American countries may
be held by a limited number of persons, which may limit the number of securities
available for the investment by the Fund. The limited liquidity of Latin
American country securities markets may also affect the Fund's ability to
acquire or dispose of securities at the price and time it wishes to do so.
The Fund, subject to local investment limitations, may invest up to 10% of its
assets (at the time of commitment) in illiquid equity securities, including
securities of private equity funds (whether in corporate or partnership form)
that invest primarily in emerging markets. When investing through another
investment fund, the Fund will bear its proportionate share of the expenses
incurred by the fund, including management fees. Such securities are expected to
be illiquid which may involve a high degree of business and financial risk and
may result in substantial losses. Because of the current absence of any liquid
trading market for these investments, the Fund may take longer to liquidate
these positions than would be the case for publicly traded securities. Although
these securities may be resold in privately negotiated transactions, the prices
realized on such sales could be substantially less than those originally paid by
the Fund or the current carrying values and these differences could be material.
Further, companies whose securities are not publicly traded may not be subject
to the disclosure and other investor protection requirements applicable to
companies whose securities are publicly traded.
NOTE C. AGREEMENTS
Credit Suisse Asset Management, LLC ("Credit Suisse") serves as the Fund's
investment adviser with respect to all investments. Credit Suisse receives as
compensation for its advisory services from the Fund, an annual fee, calculated
weekly and paid quarterly, equal to 1.00% of the first $100 million of the
Fund's average weekly market value or net assets (whichever is lower), 0.90% of
the next $50 million and 0.80% of amounts over $150 million. For the year ended
December 31, 2005, Credit Suisse earned $1,513,476 for advisory services. Credit
Suisse also provides certain administrative services to the Fund and is
reimbursed by the Fund for costs incurred on behalf of the Fund (up to $20,000
per annum). For the year ended December 31, 2005, Credit Suisse was reimbursed
$20,000 for administrative services rendered to the Fund.
16
<Page>
CELFIN CAPITAL Servicios Financieros S.A. ("Celfin") serves as the Fund's
sub-adviser with respect to Chilean investments. As compensation for its
services, Celfin is paid a fee, out of the advisory fees payable to Credit
Suisse, calculated weekly and paid quarterly at an annual rate of 0.10% of the
Fund's average weekly market value or net assets (whichever is lower). For the
year ended December 31, 2005, these sub-advisory fees amounted to $158,617.
For the year ended December 31, 2005, Celfin earned approximately $15,000 in
brokerage commissions from portfolio transactions executed on behalf of the
Fund.
Bear Stearns Funds Management Inc. ("BSFM") serves as the Fund's U.S.
administrator. The Fund paid BSFM a monthly fee that is calculated weekly based
on the Fund's average weekly net assets. For the year ended December 31, 2005,
BSFM earned $130,240 for administrative services.
Celfin Capital S.A. Administradora de Fondos de Capital Extranjero ("AFCE")
serves as the Fund's Chilean administrator. For its services, AFCE is paid an
annual fee by the Fund equal to the greater of 2,000 Unidad de Fomentos
("U.F.s") (approximately $60,000 at December 31, 2005) or 0.10% of the Fund's
average weekly market value or net assets invested in Chile (whichever is lower)
and an annual reimbursement of out-of-pocket expenses not to exceed 500 U.F.s.
In addition, an accounting fee is also paid to AFCE. For the year ended December
31, 2005, the administration fees and accounting fees amounted to $80,419 and
$5,727, respectively.
Merrill Corporation ("Merrill"), an affiliate of Credit Suisse, has been engaged
by the Fund to provide certain financial printing services. For the year ended
December 31, 2005, Merrill was paid $23,906 for its services to the Fund.
The Independent Directors receive fifty percent (50%) of their annual retainer
in the form of shares purchased by the Fund's transfer agent in the open market.
Directors as a group own less than 1% of the Fund's outstanding shares.
NOTE D. CAPITAL STOCK
The authorized capital stock of the Fund is 100,000,000 shares of common stock,
$0.001 par value. Of the 6,322,240 shares outstanding at December 31, 2005,
Credit Suisse owned 13,746 shares.
NOTE E. INVESTMENT IN SECURITIES
For the year ended December 31, 2005, purchases and sales of securities, other
than short-term investments, were $137,063,565 and $140,076,406, respectively.
NOTE F. CREDIT FACILITY
The Fund, together with other funds/portfolios advised by Credit Suisse
(collectively, the "Participating Funds"), participates in a $75 million
committed, unsecured, line of credit facility ("Credit Facility") with Deutsche
Bank, A.G. as administrative agent and syndication agent and State Street Bank
and Trust Company as operations agent for temporary or emergency purposes. Under
the terms of the Credit Facility, the Participating Funds pay an aggregate
commitment fee at a rate of 0.10% per annum on the average unused amount of the
Credit Facility, which is allocated among the Participating Funds in such manner
as is determined by the governing Boards of the Participating Funds. In
addition, the Participating Funds pay interest on borrowing at the Federal Funds
rate plus 0.50%. During the year ended December 31, 2005, the Fund had no
borrowings under the Credit Facility.
NOTE G. FEDERAL INCOME TAXES
Income and capital gains distributions are determined in accordance with federal
income tax regulations,
17
<Page>
which may differ from GAAP. These differences are primarily due to differing
treatments of foreign currency transactions, losses deferred due to wash sales
and post-October losses.
The tax character of dividends paid during the years ended December 31 for the
Fund were as follows:
<Table>
<Caption>
ORDINARY INCOME LONG-TERM CAPITAL GAINS
---------------------------- --------------------------
2005 2004 2005 2004
----------- ----------- ----------- -----------
$ 3,161,120 $ 2,908,230 $ 1,770,227 --
</Table>
Under current tax law, certain capital losses realized after October 31 within a
taxable year may be deferred and treated as occurring on the first day of the
following tax year ("Post-October losses"). For the tax year ended December 31,
2005, the Fund incurred and elected to defer net realized foreign currency
losses of $107,347.
The tax basis of components of distributable earnings differ from the amounts
reflected in the Statement of Assets and Liabilities by temporary book/tax
differences. These differences are primarily due to losses deferred on wash
sales and deferred Post-October losses. At December 31, 2005, the components of
distributable earnings on a tax basis for the Fund were as follows:
<Table>
Undistributed ordinary income $ 179,490
Accumulated net realized gain 5,774,763
Unrealized appreciation 76,391,588
------------
Total distributable earnings $ 82,345,841
============
</Table>
At December 31, 2005, the Fund utilized $36,274,467 in capital loss
carryforwards.
At December 31, 2005, the identified cost for federal income tax purposes, as
well as the gross unrealized appreciation from investments for those securities
having an excess of value over cost, gross unrealized depreciation from
investments for those securities having an excess of cost over value and the net
unrealized appreciation from investments were $149,107,534 $79,639,475,
$(3,250,168) and $76,389,307, respectively.
At December 31, 2005, the Fund reclassified $188,541 to accumulated net realized
gain on investments and foreign currency related transactions from undistributed
net investment income. Net assets were not affected by this reclassification.
NOTE H. RESTRICTED SECURITIES
Certain of the Fund's investments are restricted as to resale and are valued at
fair value as determined in good faith by, or under the direction of, the Board
of Directors under procedures established by the Board of Directors in the
absence of readily ascertainable market values.
<Table>
<Caption>
NUMBER FAIR PERCENT DISTRI-
OF ACQUISITION VALUE AT VALUE PER OF NET BUTIONS OPEN
SECURITY UNITS/SHARES DATE(S) COST 12/31/05 UNIT/SHARE ASSETS RECEIVED COMMITMENTS
- ------------------ ------------ ------------------- ----------- ----------- ---------- --------- --------- -----------
Emerging Markets
Ventures I L.P. 2,205,494 01/22/98 - 12/31/04 $ 1,543,548 $ 1,694,547 0.77 0.77
21,396 01/10/05 - 07/01/05 21,396 16,439 0.77 0.00
------------ ----------- ----------- ---------
2,226,890 1,564,944 1,710,986 0.77 $ 654,460 $ 273,110
------------ ----------- ----------- --------- --------- ----------
J.P. Morgan Latin
America Capital
Partners
(Cayman), L.P. 880,437 04/10/00 - 05/28/03 517,703 365,293 0.41 0.16
34,191 08/02/05 21,426 14,186 0.41 0.01
------------ ----------- ----------- ---------
914,628 539,129 379,479 0.17 $ 780,008 -
------------ ----------- ----------- --------- --------- ----------
</Table>
18
<Page>
<Table>
<Caption>
NUMBER FAIR PERCENT DISTRI-
OF ACQUISITION VALUE AT VALUE PER OF NET BUTIONS OPEN
SECURITY UNITS/SHARES DATE(S) COST 12/31/05 UNIT/SHARE ASSETS RECEIVED COMMITMENTS
- ------------------ ------------ ------------------- ----------- ----------- ---------- --------- --------- -----------
J.P. Morgan Latin
America Capital
Partners
(Delaware), L.P. 1,398,860 04/10/00 - 03/26/04 $ 758,379 $ 442,823 0.32 0.20
67,668 08/02/05 63,154 21,421 0.32 0.01
------------ ----------- ----------- ---------
1,466,528 821,533 464,244 0.21 $ 852,668 $ 744,382
------------ ----------- ----------- --------- ---------- ----------
Total $ 2,925,606 $ 2,554,709 1.15 $2,287,136 $1,017,492
=========== =========== ========= ========== ==========
</Table>
The Fund may incur certain costs in connection with the disposition of the above
securities.
NOTE I. CONTINGENCIES
In the normal course of business, the Fund may provide general indemnifications
pursuant to certain contracts and organizational documents. The Fund's maximum
exposure under these arrangements is dependent on future claims that may be made
against the Fund and, therefore, cannot be estimated: however, based on
experience, the risk of loss from such claims is considered remote.
19
<Page>
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholders
of The Latin America Equity Fund, Inc.:
In our opinion, the accompanying statement of assets and liabilities, including
the schedule of investments, and the related statements of operations, of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of The Latin America Equity Fund, Inc.
(the "Fund") at December 31, 2005, the results of its operations for the year
then ended, the changes in its net assets for each of the two years in the
period then ended, and the financial highlights for each of the ten years in the
period then ended, in conformity with accounting principles generally accepted
in the United States of America. These financial statements and financial
highlights (hereafter referred to as "financial statements") are the
responsibility of the Fund's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with the standards of the
Public Company Accounting Oversight Board (United States). These 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, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at December 31, 2005 by correspondence with the
custodian and private equity issuers, provide a reasonable basis for our
opinion.
PricewaterhouseCoopers LLP
Philadelphia, Pennsylvania
February 17, 2006
20
<Page>
RESULTS OF ANNUAL MEETING OF SHAREHOLDERS (UNAUDITED)
On April 21, 2005, the Annual Meeting of Shareholders of The Latin America
Equity Fund, Inc. (the "Fund") (the "Meeting") was held and the following
matters were voted upon:
(1) To re-elect one director to the Board of Directors of the Fund.
<Table>
<Caption>
NAME OF DIRECTOR FOR WITHHELD
- ---------------- -------- ---------
James J. Cattano 4,128,172 1,669,221
</Table>
In addition to the directors re-elected at the Meeting, Enrique R. Arzac, Martin
M. Torino and George W. Landau continued as directors of the Fund.
Effective April 15, 2005, William W. Priest, Jr. resigned as a Director of the
Fund.
Effective May 18, 2005, Michael E. Kenneally and Steven Rappaport were appointed
as Directors of the Fund
Effective December 6, 2005, Michael E. Kenneally resigned as a Director of the
Fund.
TAX INFORMATION (UNAUDITED)
The Fund is required by Subchapter M of the Internal Revenue Code of 1986, as
amended, to advise its shareholders within 60 days of the Fund's year end
(December 31, 2005) as to the U.S. federal tax status of dividends and
distributions received by the Fund's shareholders in respect of such year. Of
the $0.78 per share distributions paid in respect of such year, $0.50 per share
was derived from ordinary income and $0.28 per share was derived from net
realized long-term capital gains. The Fund has met the requirements to pass
through all ordinary income as qualified dividends as noted on Box 1B on Form
1099-DIV. Please note that to utilize the lower tax rate for qualifying dividend
income, shareholders generally must have held their shares in the Fund for at
least 61 days during the 121 day period beginning 60 days before the ex-dividend
date.
The Fund has made an election under Section 853 to pass through foreign taxes
paid by the Fund to its shareholders. The amount of foreign taxes that were
passed through to shareholders for the year ended December 31, 2005, was
$425,612, equal to $0.07 per share from Brazil. The entire amount of foreign
source income is from qualifying dividend income. This information is given to
meet certain requirements of the Internal Revenue Code of 1986, as amended.
Shareholders should refer to their Form 1099-DIV to determine the amount
includable on their respective tax returns for 2005.
Notification for calendar year 2005 was mailed in January 2006. The notification
along with Form 1099-DIV reflects the amount to be used by calendar year
taxpayers on their U.S. federal income tax returns.
Foreign shareholders will generally be subject to U.S. withholding tax on the
amount of the actual ordinary dividends paid by the Fund. They will generally
not be entitled to foreign tax credit or deduction for the withholding taxes
paid by the Fund.
In general, distributions received by tax-exempt recipients (e.g., IRAs and
Keoghs) need not be reported as taxable income for U.S. federal income tax
purposes. However, some retirement trusts (e.g., corporate, Keogh and 403(b)(7)
plans) may need this information for their annual information reporting.
Shareholders are advised to consult their own tax advisers with respect to the
tax consequences of their investment in the Fund.
21
<Page>
DESCRIPTION OF INVESTLINK(SM) PROGRAM (UNAUDITED)
The InvestLink(SM) Program is sponsored and administered by Computershare Trust
Company, N.A. ("Computershare"), not by The Latin America Equity Fund, Inc. (the
"Fund"). Computershare will act as program administrator (the "Program
Administrator") of the InvestLink(SM) Program (the "Program"). The purpose of
the Program is to provide existing shareholders with a simple and convenient way
to invest additional funds and reinvest dividends in shares of the Fund's common
stock ("Shares") at prevailing prices, with reduced brokerage commissions and
fees.
In order to participate in the Program, you must be a registered holder of at
least one Share of stock of the Fund. Purchases of Shares with funds from a
participant's cash payment or automatic account deduction will begin on the next
day on which funds are invested. All cash payments must be drawn on a U.S. bank
and payable in U.S. dollars. Checks must be made payable to Computershare. If a
participant selects the dividend reinvestment option, automatic investment of
dividends generally will begin with the next dividend payable after the Program
Administrator receives his enrollment form. Once in the Program, a person will
remain a participant until he terminates his participation or sells all Shares
held in his Program account, or his account is terminated by the Program
Administrator. A participant may change his investment options at any time by
requesting a new enrollment form and returning it to the Program Administrator.
A participant will be assessed certain charges in connection with his
participation in the Program. All optional cash deposit investments will be
subject to a service charge. Sales processed through the Program will have a
service fee deducted from the net proceeds, after brokerage commissions. In
addition to the transaction charges outlined above, participants will be
assessed per share processing fees (which include brokerage commissions.)
Participants will not be charged any fee for reinvesting dividends.
The number of Shares to be purchased for a participant depends on the amount of
his dividends, cash payments or bank account or payroll deductions, less
applicable fees and commissions, and the purchase price of the Shares. The
investment date for cash payments is the 25th day of each month (or the next
trading day if the 25th is not a trading day). The investment date for dividend
reinvestment is the dividend payment date. The Program Administrator uses
dividends and funds of participants to purchase Shares of the Fund in the open
market. Such purchases will be made by participating brokers as agent for the
participants using normal cash settlement practices. All Shares purchased
through the Program will be allocated to participants as of the settlement date,
which is usually three business days from the purchase date. In all cases,
transaction processing will occur within 30 days of the receipt of funds, except
where temporary curtailment or suspension of purchases is necessary to comply
with applicable provisions of the Federal Securities laws or when unusual market
conditions make prudent investment impracticable. In the event the Program
Administrator is unable to purchase Shares within 30 days of the receipt of
funds, such funds will be returned to the participants.
The average price of all Shares purchased by the Program Administrator with all
funds received during the time period from two business days preceding any
investment date up to the second business day preceding the next investment date
shall be the price per share allocable to a participant in connection with the
Shares purchased for his account with his funds or dividends received by the
Program Administrator during such time period. The average price of all Shares
sold by the Program Administrator pursuant to sell orders received during such
time period shall be the price per share allocable to a participant in
connection with the Shares sold for his account pursuant to his sell orders
received by the Program Administrator during such time period. All sale requests
having an
22
<Page>
anticipated market value of $100,000.00 or more are expected to be submitted in
written form. In addition, all sale requests received by the Program
Administrator within thirty (30) days of an address change are expected to be
submitted in written form.
Computershare, as Program Administrator, administers the Program for
participants, keeps records, sends statements of account to participants and
performs other duties relating to the Program. Each participant in the Program
will receive a statement of his account following each purchase of Shares. The
statements will also show the amount of dividends credited to such participant's
account (if applicable), as well as the fees paid by the participant. In
addition, each participant will receive copies of the Fund's annual and
semi-annual reports to shareholders, proxy statements and, if applicable,
dividend income information for tax reporting purposes.
If the Fund is paying dividends on the Shares, a participant will receive
dividends through the Program for all Shares held on the dividend record date on
the basis of full and fractional Shares held in his account, and for all other
Shares of the Fund registered in his name. The Program Administrator will send
checks to the participants for the amounts of their dividends that are not to be
automatically reinvested at no cost to the participants.
Shares of the Fund purchased under the Program will be registered in the name of
the accounts of the respective participants. Unless requested, the Fund will not
issue to participants certificates for Shares of the Fund purchased under the
Program. The Program Administrator will hold the Shares in book-entry form until
a Program participant chooses to withdraw his Shares or terminate his
participation in the Program. The number of Shares purchased for a participant's
account under the Program will be shown on his statement of account. This
feature protects against loss, theft or destruction of stock certificates.
A participant may withdraw all or a portion of the Shares from his Program
account by notifying the Program Administrator. After receipt of a participant's
request, the Program Administrator will issue to such participant certificates
for the whole Shares of the Fund so withdrawn or, if requested by the
participant, sell the Shares for him and send him the proceeds, less applicable
brokerage commissions, fees, and transfer taxes, if any. If a participant
withdraws all full and fractional Shares in his Program account, his
participation in the Program will be terminated by the Program Administrator. In
no case will certificates for fractional Shares be issued. The Program
Administrator will convert any fractional Shares held by a participant at the
time of his withdrawal to cash.
Participation in any rights offering, dividend distribution or stock split will
be based upon both the Shares of the Fund registered in participants' names and
the Shares (including fractional Shares) credited to participants' Program
accounts. Any stock dividend or Shares resulting from stock splits with respect
to Shares of the Fund, both full and fractional, which participants hold in
their Program accounts and with respect to all Shares registered in their names
will be automatically credited to their accounts.
All Shares of the Fund (including any fractional share) credited to his account
under the Program will be voted as the participant directs. The participants
will be sent the proxy materials for the annual meetings of shareholders. When a
participant returns an executed proxy, all of such Shares will be voted as
indicated. A participant may also elect to vote his Shares in person at the
Shareholders' meeting.
23
<Page>
A participant will receive tax information annually for his personal records and
to help him prepare his U.S. federal income tax return. The automatic
reinvestment of dividends does not relieve him of any income tax which may be
payable on dividends. For further information as to tax consequences of
participation in the Program, participants should consult with their own tax
advisors.
The Program Administrator in administering the Program will not be liable for
any act done in good faith or for any good faith omission to act. However, the
Program Administrator will be liable for loss or damage due to error caused by
its negligence, bad faith or willful misconduct. Shares held in custody by the
Program Administrator are not subject to protection under the Securities
Investors Protection Act of 1970.
The participant should recognize that neither the Fund nor the Program
Administrator can provide any assurance of a profit or protection against loss
on any Shares purchased under the Program. A participant's investment in Shares
held in his Program account is no different than his investment in directly held
Shares in this regard. The participant bears the risk of loss and the benefits
of gain from market price changes with respect to all of his Shares. Neither the
Fund nor the Program Administrator can guarantee that Shares purchased under the
Program will, at any particular time, be worth more or less than their purchase
price. Each participant must make an independent investment decision based on
his own judgment and research.
While the Program Administrator hopes to continue the Program indefinitely, the
Program Administrator reserves the right to suspend or terminate the Program at
any time. It also reserves the right to make modifications to the Program.
Participants will be notified of any such suspension, termination or
modification in accordance with the terms and conditions of the Program. The
Program Administrator also reserves the right to terminate any participant's
participation in the Program at any time. Any question of interpretation arising
under the Program will be determined in good faith by the Program Administrator
and any such good faith determination will be final.
Any interested shareholder may participate in the Program. All other cash
payments or bank account deductions must be at least $100.00, up to a maximum of
$100,000.00 annually. An interested shareholder may join the Program by reading
the Program description, completing and signing the enrollment form and
returning it to the Program Administrator. The enrollment form and information
relating to the Program (including the terms and conditions) may be obtained by
calling the Program Administrator at one of the following telephone numbers:
(800) 730-6001 (U.S. and Canada) or (781) 575-3100 (outside U.S. and Canada).
All correspondence regarding the Program should be directed to: Computershare
Trust Company, N.A., InvestLink(SM) Program, P.O. Box 43010, Providence, RI
02940-3010.
InvestLink is a service mark of Computershare Trust Company, N.A.
24
<Page>
INFORMATION CONCERNING DIRECTORS AND OFFICERS (UNAUDITED)
<Table>
<Caption>
TERM NUMBER OF
OF OFFICE PORTFOLIOS IN
AND FUND
POSITION(S) LENGTH PRINCIPAL COMPLEX OTHER
NAME, ADDRESS AND HELD WITH OF TIME OCCUPATION(s) DURING OVERSEEN BY DIRECTORSHIPS
DATE OF BIRTH FUND SERVED THE PAST FIVE YEARS DIRECTOR HELD BY DIRECTOR
- ----------------------------- --------------- -------------- ------------------------ ------------- -------------------
INDEPENDENT DIRECTORS
Enrique R. Arzac* Chairman of the Director since Professor of Finance and 47 Director of The
c/o Credit Suisse Asset Board of 1996; Economics, Graduate Adams Express
Management, LLC Directors; Chairman School of Business, Company (a closed-
Attn: General Counsel Nominating since 2005; Columbia University end investment
466 Lexington Avenue Committee current term since 1971 company); Director
New York, New York Chairman and ends at the of Petroleum and
10017-3140 Audit Committee 2006 annual Resources Corpora-
Member meeting tion (a closed-end
investment company)
Date of Birth: 10/02/41
James J. Cattano Director; Since 1990; President, Primary 4 None
c/o Primary Resources, Inc. Nominating current term Resources, Inc. (an
55 Old Field Point Road Committee ends at the international trading
Greenwich, Connecticut Member and 2007 annual and manufacturing
06830 Audit Committee meeting company specializing
Chairman in the sale of
Date of Birth: 06/24/43 agricultural commodities
throughout Latin
American markets)
since October 1996
Steven N. Rappaport Director; Since 1992; Partner of Lehigh Court, 46 Director of
Lehigh Court, LLC Nominating current term LLC and RZ Capital Presstek, Inc.
40 East 52nd Street and Audit ends at the (private investment (digital imaging
New York, New York Committee 2008 annual firms) since July 2002; technologies
10022 Member meeting Transition Advisor to company); Director
SunGard Securities of Wood Resources,
Date of Birth: 07/10/48 Finance, Inc. from LLC (plywood
February 2002 to July manufacturing
2002; President of company)
SunGard Securities
Finance, Inc. from 2001
to February 2002;
President of Loanet,
Inc. (on-line accounting
service) from 1997 to
2001
Martin M. Torino Director; Since 1990; Chief Executive Officer 3 None
c/o Credit Suisse Asset Nominating and current term and Director of Celsur
Management, LLC Audit Committee ends at the Logistica S.A.
Attn: General Counsel Member 2007 annual (Logistics) since 2002;
466 Lexington Avenue meeting Chairman of the Board of
New York, New York Ingenio y Refineria San
10017-3140 Martin Del Tabacal S.A.
(a sugar refinery) from
Date of Birth: 08/14/49 August 1996 to 2000
George W. Landau Honorary Since 2005; Senior Advisor, Latin 4 Director of GAM
c/o Credit Suisse Asset Director Director since America, The Coca-Cola Funds, Inc.
Management, LLC 1990 Company since 1988;
Attn: General Counsel Advisor of Guardian
466 Lexington Avenue Industries (a glass
New York, New York manufacturer) since 1992
10017-3140
Date of Birth: 03/04/20
</Table>
- ----------
* Effective December 6, 2005, Enrique R. Arzac was appointed as Chairman of
the Board, Michael E. Kenneally, who previously held this position,
resigned as a Director effective December 6, 2005.
25
<Page>
<Table>
<Caption>
POSITION(S) LENGTH
NAME, ADDRESS AND HELD WITH OF TIME
DATE OF BIRTH FUND SERVED PRINCIPAL OCCUPATION(s) DURING PAST FIVE YEARS
- ----------------------------- --------------- ------------ -----------------------------------------------------------------
OFFICERS
Steven B. Plump** Chief Executive Since 2005 Managing Director; Associated with Credit Suisse or its
Credit Suisse Asset Officer and predecessor since 1995; Officer of other Credit Suisse Funds
Management, LLC President
466 Lexington Avenue
New York, New York
10017-3140
Date of Birth: 02/08/59
Matthew J.K. Hickman*** Chief Since 2004 Director of Credit Suisse; Financial Advisor with Global Advisors
Credit Suisse Asset Investment from July 2003 to November 2003; General Manager of Compass Group
Management, LLC Officer Investment Advisors S.A. from February 2002 to July 2003;
466 Lexington Avenue Financial Advisor with Credit Suisse First Boston from August
New York, New York 2000 to February 2002; Director of ABN AMRO from September 1998
10017-3140 to August 2000; Officer of other Credit Suisse Funds
Date of Birth: 01/21/64
Michael A. Pignataro Chief Financial Since 1993 Director and Director of Fund Administration of Credit Suisse;
Credit Suisse Asset Officer and Associated with Credit Suisse or its predecessor since 1984;
Management, LLC Secretary Officer of other Credit Suisse Funds
466 Lexington Avenue
New York, New York
10017-3140
Date of Birth: 11/15/59
Emidio Morizio Chief Since 2004 Director and Global Head of Compliance of Credit Suisse;
Credit Suisse Asset Compliance Associated with Credit Suisse since July 2000; Vice President and
Management, LLC Officer Director of Compliance of Forstmann-Leff Associates from 1998 to
466 Lexington Avenue June 2000; Officer of other Credit Suisse Funds
New York, New York
10017-3140
Date of Birth: 09/21/66
Ajay Mehra Chief Legal Since 2004 Director and Head of Legal Americas Traditional Asset Management
Credit Suisse Asset Officer and Hedge Funds; Associated with Credit Suisse since September
Management, LLC 2004; Senior Associate of Sherman & Sterling LLP from September
466 Lexington Avenue 2000 to September 2004; Senior Counsel of the SEC Division of
New York, New York Investment Management from June 1997 to September 2000; Officer
10017-3140 of other Credit Suisse Funds
Date of Birth: 08/14/70
</Table>
- ----------
** Effective July 31, 2005, Steven B. Plump was appointed as Chief Executive
Officer and President of the Fund. Michael E. Kenneally, who previously
held these positions, resigned effective July 31, 2005.
26
<Page>
<Table>
<Caption>
POSITION(S) LENGTH
NAME, ADDRESS AND HELD WITH OF TIME
DATE OF BIRTH FUND SERVED PRINCIPAL OCCUPATION(s) DURING PAST FIVE YEARS
- ----------------------------- --------------- ------------ -----------------------------------------------------------------
J. Kevin Gao Senior Vice Since 2004 Director and Legal Counsel of Credit Suisse; Associated with
Credit Suisse Asset President Credit Suisse since July 2003; Associated with the law firm of
Management, LLC Willkie Farr & Gallagher LLP from 1998 to 2003; Officer of other
466 Lexington Avenue Credit Suisse Funds
New York, New York
10017-3140
Date of Birth: 10/13/67
Robert Rizza Treasurer Since 1999 Vice President of Credit Suisse; Associated with Credit Suisse
Credit Suisse Asset since 1998; Officer of other Credit Suisse Funds
Management, LLC
466 Lexington Avenue
New York, New York
10017-3140
Date of Birth: 12/09/65
</Table>
27
<Page>
ANNUAL CERTIFICATIONS (UNAUDITED)
The Fund's Chief Executive Officer has filed an annual certification with the
NYSE that, as of the date of the certification, he was unaware of any violation
by the Fund of the NYSE's corporate governance listing standards. The Fund's
Chief Executive Officer and Chief Financial Officer have also filed
certifications with the SEC as part of the Fund's Form N-CSR filings that cover
certain public disclosure documents of the Fund, including its annual and
semi-annual reports to stockholders.
28
<Page>
ADVISORY AGREEMENT APPROVAL DISCLOSURE (UNAUDITED)
BOARD CONSIDERATION AND RE-APPROVAL OF INVESTMENT ADVISORY AGREEMENT
Section 15(c) of the Investment Company Act of 1940 (the "1940 Act")
contemplates that the Board of Directors (the "Board") of The Latin America
Equity Fund, Inc. (the "Fund"), including a majority of the Directors who have
no direct or indirect interest in the investment advisory and sub-advisory
agreements and are not "interested persons" of the Fund, as defined in the 1940
Act (the "Independent Directors"), are required to annually review and
re-approve the terms of the Fund's existing investment advisory and sub-advisory
agreements and approve any newly proposed terms therein. In this regard, the
Board reviewed and re-approved, during the most recent six months covered by
this report: (i) an investment advisory agreement with Credit Suisse Asset
Management, LLC ("Credit Suisse") for the Fund, and (ii) a sub-advisory
agreement with CELFIN CAPITAL Servicios Financieros S.A. ("CELFIN" or the
"Sub-Adviser") for the Fund. The investment advisory agreement with Credit
Suisse and the investment sub-advisory agreement with CELFIN are collectively
referred to as the "Advisory Agreements."
More specifically, at a meeting held on November 16-17, 2005, the Board,
including the Independent Directors advised by their independent legal counsel,
considered the factors and reached the conclusions described below relating to
the selection of Credit Suisse and the Sub-Adviser and the re-approval of the
Advisory Agreements.
NATURE, EXTENT AND QUALITY OF SERVICES
The Board received and considered various data and information regarding the
nature, extent and quality of services provided to the Fund by Credit Suisse and
the Sub-Adviser under the Advisory Agreements. The most recent investment
adviser registration forms ("Forms ADV") for Credit Suisse and the Sub-Adviser
were provided to the Board, as were responses of Credit Suisse and the
Sub-Adviser to a detailed series of requests submitted by the Independent
Directors' independent legal counsel on behalf of such Directors. The Board
reviewed and analyzed these materials, which included, among other things,
information about the background and experience of the senior management and the
expertise of, and amount of attention devoted to the Fund by investment
personnel of Credit Suisse and the Sub-Adviser. In this regard, the Board
specifically reviewed the qualifications, backgrounds and responsibilities of
the individuals primarily responsible for day-to-day portfolio management
services for the Fund.
In addition, the Board received and reviewed information on Securities and
Exchange Commission ("SEC") and other regulatory inquiries and examinations
relating to the Fund, Credit Suisse and the Sub-Adviser. The Board considered
the investment and legal compliance programs of each of these entities,
including their implementation of enhanced compliance policies and procedures in
response to SEC rule changes and other regulatory initiatives. The Board also
considered the Fund's Chief Compliance Officer's report and recommendations.
The Board evaluated the ability of Credit Suisse and the Sub-Adviser, including
their respective resources, reputations and other attributes, to attract and
retain highly qualified investment professionals, including research, advisory,
and supervisory personnel. In this regard, the Board considered information
regarding Credit Suisse's compensation program for its personnel involved in the
management of the Fund, including incentive and retirement plans.
29
<Page>
Based on the above factors, together with those referenced below, the Board
concluded that it was generally satisfied with the nature, extent and quality of
the investment advisory services provided to the Fund by Credit Suisse and the
Sub-Adviser.
FUND PERFORMANCE AND EXPENSES
The Board considered the performance results of the Fund over a number of years
and since the inception of the Fund, as well as for recent periods. It also
considered these results in comparison to the Fund's benchmark index, the MSCI
Emerging Markets Free Latin America Index. The Board also considered the Fund's
performance compared with the performance of two other peer Latin America funds.
The Board noted that the Fund underperformed its benchmark index in some periods
and outperformed it in others. The Board also noted that the Fund had
underperformed the peer funds in some periods but outperformed them in others.
In addition, the Board received and considered statistical information regarding
the Fund's total expense ratio and its various components, including management
fees, non-management fees, fee waivers/caps and/or expense reimbursements and
actual total expenses of the Fund (including and excluding investment-related
expenses and taxes). The Board observed that the Fund's total expense ratio was
lower than the median overall expense ratio of a group of funds that was
determined to be the most similar to the Fund (the "Peer Group") and the median
overall expense ratio of a broader universe of relevant funds (the "Universe").
Lipper Inc. ("Lipper"), an independent provider of investment company data,
determined the Peer Group and Universe for the Fund and provided the comparative
data. The Board was provided with a description of the methodology used by
Lipper to select the closed-end mutual funds in the Fund's Peer Group and
Universe. It also considered comparisons of these fees to the expense
information for the Fund's Peer Group and Universe.
Based on the above-referenced considerations and other factors, the Board
concluded that the overall performance and expense results supported the
re-approval of the Advisory Agreements for the Fund.
INVESTMENT ADVISORY AND SUB-ADVISORY FEE RATES
The Board reviewed and considered the proposed contractual investment advisory
fee rate (the "Advisory Agreement Rate") payable by the Fund to Credit Suisse
for investment advisory services. The Board also reviewed and considered the
proposed contractual investment sub-advisory fee rate (the "Sub-Advisory
Agreement Rate") payable by Credit Suisse to the Sub-Adviser for investment
sub-advisory services. In addition, the Board reviewed and considered the
proposed fee waiver/cap arrangements applicable to the Advisory Agreement Rate
and considered the Advisory Agreement Rate after taking the waivers into account
(the "Net Advisory Rate"). The Board noted that Credit Suisse had voluntary fee
waivers in effect to base its current investment advisory fee upon the lower of
the average weekly stock price or its average weekly net assets and to waive a
portion of its fees previously paid to the Fund's former sub-advisers in Brazil,
Argentina and Mexico.
Additionally, the Board received and considered information comparing the Net
Advisory Rate (both on a stand-alone basis and on a combined basis with the
Fund's administration fee rates) with those of the other funds in its Peer
Group. The Board noted that the Net Advisory Rate for the Fund was lower than
the median rates of the Fund's Peer
30
<Page>
Group. The Board also noted that the Fund's administrator is not affiliated with
Credit Suisse and that the Fund's administration agreement and corresponding
fees were negotiated at arms-length. The Board observed that the combined rates
of investment advisory and administration fees for the Fund were lower than the
median combined rates of its Peer Group. The Board concluded that these and
other factors supported the Advisory Agreement Rate and the Net Advisory Rate,
and approved the Advisory Agreement for the Fund.
PROFITABILITY
The Board received and considered an estimated profitability analysis of Credit
Suisse based on the Advisory Agreement Rate and the Net Advisory Rate, as well
as on other relationships between the Fund and Credit Suisse and its affiliates.
The Board concluded that, in light of the costs of providing investment
management and other services to the Fund, the profits and other ancillary
benefits that Credit Suisse and its affiliates received with regard to providing
these services to the Fund were not unreasonable.
The Board also received and considered an income statement related to the Fund
from the Sub-Adviser. The Board observed the costs of providing portfolio
management and other services to the Fund. The Board also noted that the
sub-advisory fees are paid to CELFIN by Credit Suisse and not directly by the
Fund, and that the Board separately determined that the Advisory Agreement Rate
for the Fund was fair and equitable. Based on these factors, the Board concluded
that the profits and other ancillary benefits that CELFIN and its affiliates
received with regard to providing these services to the Fund were not
unreasonable.
ECONOMIES OF SCALE
The Board received and considered information regarding whether there have been
economies of scale with respect to the management of the Fund, whether the Fund
has appropriately benefited from any economies of scale, and whether there is
potential for realization of any further economies of scale. The Board concluded
that any actual or potential economies of scale are, or will be, shared fairly
with Fund shareholders, including most particularly through Advisory Agreement
Rate breakpoints.
INFORMATION ABOUT SERVICES TO OTHER CLIENTS
The Board received and considered information about the nature and extent of
services and fee rates offered by Credit Suisse to their other clients,
including other registered investment companies and institutional investors and
investment companies to which Credit Suisse serves as an unaffiliated
sub-adviser. The Board also received and considered information about the nature
and extent of services offered by the Sub-Adviser to other clients. The Board
concluded that the Advisory Agreement Rate and Sub-Advisory Agreement Rate were
reasonable, considering factors such as the nature and extent of services
provided and comparison with rates offered to other clients. Where Credit
Suisse's rates offered to its other clients were appreciably lower, the Board
considered that Credit Suisse's voluntary fee waivers would decrease the
Advisory Agreement Rate. The Board concluded, based on information provided by
Credit Suisse, that the costs associated with managing and operating a
registered, closed-end, international fund, compared with other clients or other
funds, provided a justification for the higher fee rates charged to the Fund.
31
<Page>
OTHER BENEFITS TO CREDIT SUISSE
The Board received and considered information regarding potential "fall-out" or
ancillary benefits received by Credit Suisse and its affiliates as a result of
their relationship with the Fund. Such benefits could include, among others,
benefits directly attributable to the relationship of Credit Suisse with the
Fund (such as soft-dollar credits) and benefits potentially derived from an
increase in the business of Credit Suisse as a result of its relationship with
the Fund (such as the ability to market to shareholders other financial products
offered by Credit Suisse and its affiliates).
OTHER FACTORS AND BROADER REVIEW
As discussed above, the Board reviews detailed materials received from Credit
Suisse and the Sub-Adviser annually as part of the re-approval process under
Section 15(c) of the 1940 Act. The Board also reviews and assesses the quality
of the services that the Fund receives throughout the year. In this regard, the
Board reviews reports of Credit Suisse and the Sub-Adviser at least in each of
its quarterly meetings, which include, among other things, a detailed portfolio
review and detailed fund performance reports, and confers with the chief
investment officer and managers of the Fund at various times throughout the
year.
After considering the above-described factors and based on the deliberations and
its evaluation of the information provided to it, the Board concluded that
re-approval of the Advisory Agreements for the Fund was in the best interest of
the Fund and its shareholders. Accordingly, the Board unanimously re-approved
the Advisory Agreements.
32
<Page>
PROXY VOTING AND PORTFOLIO HOLDINGS INFORMATION (UNAUDITED)
Information regarding how The Latin America Equity Fund, Inc. (the "Fund") voted
proxies related to its portfolio securities during the 12-month period ended
June 30 of each year, as well as the policies and procedures that the Fund uses
to determine how to vote proxies relating to its portfolio securities are
available:
- By calling 1-800-293-1232;
- On the Fund's website, www.credit-suisse.com/us
- On the website of the Securities and Exchange Commission,
http://www.sec.gov.
The Fund files a complete schedule of its portfolio holdings for the first and
third quarters of its fiscal year with the SEC on Form N-Q. The Fund's Forms N-Q
are available on the SEC's website at http://www.sec.gov and may be reviewed and
copied at the SEC's Public Reference Room in Washington, DC. Information on the
operation of the SEC's Public Reference Room may be obtained by calling
1-800-SEC-0330.
33
<Page>
OTHER FUNDS MANAGED BY CREDIT SUISSE ASSET MANAGEMENT, LLC
Credit Suisse Capital Appreciation Fund
Credit Suisse Cash Reserve Fund
Credit Suisse Commodity Return Strategy Fund
Credit Suisse Emerging Markets Fund
Credit Suisse Fixed Income Fund
Credit Suisse Global Fixed Income Fund
Credit Suisse Global Small Cap Fund
Credit Suisse High Income Fund
Credit Suisse International Focus Fund
Credit Suisse Japan Equity Fund
Credit Suisse Large Cap Blend Fund
Credit Suisse Large Cap Value Fund
Credit Suisse Mid-Cap Growth Fund
Credit Suisse New York Municipal Fund
Credit Suisse Short Duration Bond Fund
Credit Suisse Small Cap Growth Fund
Credit Suisse Small Cap Value Fund
Credit Suisse Strategic Allocation Fund
Fund shares are not deposits or other obligations of Credit Suisse Asset
Management, LLC or any affiliate, are not FDIC-insured and are not guaranteed by
Credit Suisse Asset Management, LLC or any affiliate. Fund investments are
subject to investment risks, including loss of your investment. There are
special risk considerations associated with international, global,
emerging-market, small-company, private equity, high-yield debt,
single-industry, single-country and other special, aggressive or concentrated
investment strategies. Past performance cannot guarantee future results.
More complete information about a fund, including charges and expenses, is
provided in the Prospectus, which should be read carefully before investing. You
may obtain copies by calling Credit Suisse Funds at 800-927-2874. For up-to-date
performance, please look in the mutual fund section of your newspaper under
Credit Suisse.
Credit Suisse Asset Management Securities, Inc., Distributor.
34
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SUMMARY OF GENERAL INFORMATION (UNAUDITED)
The Fund--The Latin America Equity Fund, Inc.--is a closed-end, non-diversified
management investment company whose shares trade on the New York Stock Exchange,
Inc. Its investment objective is long-term capital appreciation through
investments primarily in Latin American equity securities. Credit Suisse Asset
Management, LLC, the Fund's investment adviser, is part of the Asset Management
business of Credit Suisse, a leading global financial services organization
headquartered in Zurich, with offices focused on asset management in 18
countries.
SHAREHOLDER INFORMATION
The Fund's market price is published in THE NEW YORK TIMES (daily) under the
designation "LatAEqty", THE WALL STREET JOURNAL (daily) under the designation of
"LatAmEq", and BARRON'S (each Monday) under the designation "Latin Amer Eq". The
Fund's New York Stock Exchange, Inc. trading symbol is LAQ. Weekly comparative
net asset value (NAV) and market price information about The Latin America
Equity Fund, Inc.'s shares are published each Sunday in THE NEW YORK TIMES and
each Monday in THE WALL STREET JOURNAL and BARRON'S, as well as other
newspapers, in a table called "Closed-End Funds."
THE CSAM GROUP OF FUNDS
LITERATURE REQUEST--Call today for free descriptive information on the
closed-end funds listed below at 1-800-293-1232 or visit our website on the
Internet: http://www.credit-suisse.com/us
CLOSED-END FUNDS
SINGLE COUNTRY
The Chile Fund, Inc. (CH)
The First Israel Fund, Inc. (ISL)
The Indonesia Fund, Inc. (IF)
MULTIPLE COUNTRY
The Emerging Markets Telecommunications Fund, Inc. (ETF)
FIXED INCOME
Credit Suisse Asset Management Income Fund, Inc. (CIK)
Credit Suisse High Yield Bond Fund (DHY)
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940, as amended, that The Latin America Equity Fund, Inc. may
from time to time purchase shares of its capital stock in the open market.
<Page>
DIRECTORS AND CORPORATE OFFICERS
Enrique R. Arzac Chairman of the Board of Directors
James J. Cattano Director
George W. Landau Honorary Director
Steven Rappaport Director
Martin M. Torino Director
Steven B. Plump Chief Executive Officer and President
Matthew J.K. Hickman Chief Investment Officer
J. Kevin Gao Senior Vice President
Ajay Mehra Chief Legal Officer
Emidio Morizio Chief Compliance Officer
Michael A. Pignataro Chief Financial Officer and Secretary
Robert Rizza Treasurer
John E. Smith, Jr. Assistant Treasurer
Karen Regan Assistant Secretary
INVESTMENT ADVISER
Credit Suisse Asset Management, LLC
466 Lexington Avenue
New York, NY 10017
INVESTMENT SUB-ADVISER
Celfin Capital Servicios Financieros S.A.
Apoquindo 3721, Piso 19
Santiago, Chile
ADMINISTRATOR
Bear Stearns Funds Management Inc.
383 Madison Avenue
New York, NY 10179
CUSTODIAN
Brown Brothers Harriman & Co.
40 Water Street
Boston, MA 02109
SHAREHOLDER SERVICING AGENT
Computershare Trust Company, N.A.
P.O. Box 43010
Providence, RI 02940
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
PricewaterhouseCoopers LLP
Two Commerce Square
Philadelphia, PA 19103
LEGAL COUNSEL
Willkie Farr & Gallagher LLP
787 Seventh Avenue
New York, NY 10019
This report, including the financial statements herein, is sent to the
shareholders of the Fund for their information. It is not a prospectus, circular
or representation intended for use in the purchase or sale of shares of the Fund
or of any securities mentioned in this report.
[LAQ LISTED NYSE(R) LOGO]
LAQ-AR-1205
<Page>
ITEM 2. CODE OF ETHICS.
The registrant has adopted a code of ethics applicable to its Chief Executive
Officer, President, Chief Financial Officer and Chief Accounting Officer, or
persons performing similar functions. A copy of the code is filed as Exhibit
12(a)(1) to this Form. There were no amendments to the code during the fiscal
year ended December 31, 2005. There were no waivers or implicit waivers from the
code granted by the registrant during the fiscal year ended December 31, 2005.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The registrant's governing board has determined that it has two audit committee
financial experts serving on its audit committee: Enrique R. Arzac and Steven N.
Rappaport. Each audit committee financial expert is "independent" for purposes
of this item.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) through (d). The information in the table below is provided for services
rendered to the registrant by its independent registered public accounting firm,
PricewaterhouseCoopers LLP ("PwC"), for its fiscal years ended December 31, 2004
and December 31, 2005.
<Table>
<Caption>
2004 2005
---------- ----------
Audit Fees $ 56,150 $ 59,850
Audit-Related Fees(1) $ 4,500 $ 3,150
Tax Fees(2) $ 7,482 $ 7,860
All Other Fees -- --
Total $ 68,132 $ 70,860
</Table>
(1) Services include agreed-upon procedures in connection with the registrant's
semi-annual financial statements ($3,000 in 2004 and $3,150 in 2005) and
the registrant's third quarter 2004 Form N-Q filing ($1,500).
(2) Tax services in connection with the registrant's excise tax calculations
and review of the registrant's applicable tax returns.
The information in the table below is provided with respect to non-audit
services that directly relate to the registrant's operations and financial
reporting and that were rendered by PwC to the registrant's investment adviser,
Credit Suisse Asset Management, LLC ("Credit Suisse"), and any service provider
to the registrant controlling, controlled by or under common control with Credit
Suisse that provided ongoing services to the registrant ("Covered Services
Provider"), for the registrant's fiscal years ended December 31, 2004 and
December 31, 2005.
<Table>
<Caption>
2004 2005
---------- ----------
Audit-Related Fees N/A N/A
</Table>
<Page>
<Table>
Tax Fees N/A N/A
All Other Fees N/A $ 394,000
Total N/A $ 394,000
</Table>
(e)(1) Pre-Approval Policies and Procedures. The Audit Committee ("Committee")
of the registrant is responsible for pre-approving (i) all audit and permissible
non-audit services to be provided by the independent registered public
accounting firm to the registrant and (ii) all permissible non-audit services to
be provided by the independent registered public accounting firm to Credit
Suisse and any Covered Services Provider if the engagement relates directly to
the operations and financial reporting of the registrant. The Committee may
delegate its responsibility to pre-approve any such audit and permissible
non-audit services to the Chairperson of the Committee, and the Chairperson
shall report to the Committee, at its next regularly scheduled meeting after the
Chairperson's pre-approval of such services, his or her decision(s). The
Committee may also establish detailed pre-approval policies and procedures for
pre-approval of such services in accordance with applicable laws, including the
delegation of some or all of the Committee's pre-approval responsibilities to
other persons (other than Credit Suisse or the registrant's officers).
Pre-approval by the Committee of any permissible non-audit services shall not be
required so long as: (i) the aggregate amount of all such permissible non-audit
services provided to the registrant, Credit Suisse and any Covered Services
Provider constitutes not more than 5% of the total amount of revenues paid by
the registrant to its independent registered public accounting firm during the
fiscal year in which the permissible non-audit services are provided; (ii) the
permissible non-audit services were not recognized by the registrant at the time
of the engagement to be non-audit services; and (iii) such services are promptly
brought to the attention of the Committee and approved by the Committee (or its
delegate(s)) prior to the completion of the audit.
(e)(2) The information in the table below sets forth the percentages of fees for
services (other than audit, review or attest services) rendered by PwC to the
registrant for which the pre-approval requirement was waived pursuant to Rule
2-01(c)(7)(i)(C) of Regulation S-X:
<Table>
2004 2005
---------- ----------
Audit-Related Fees N/A N/A
Tax Fees N/A N/A
All Other Fees N/A N/A
Total N/A N/A
</Table>
<Page>
The information in the table below sets forth the percentages of fees for
services (other than audit, review or attest services) rendered by PwC to Credit
Suisse and any Covered Services Provider required to be approved pursuant to
Rule 2-01(c)(7)(ii)of Regulation S-X, for the registrant's fiscal years ended
December 31, 2004 and December 31, 2005:
<Table>
<Caption>
2004 2005
---------- ----------
Audit-Related Fees N/A N/A
Tax Fees N/A N/A
All Other Fees N/A N/A
Total N/A N/A
</Table>
(f) Not Applicable.
(g) The aggregate fees billed by PwC for non-audit services rendered to the
registrant, Credit Suisse and Covered Service Providers for the fiscal years
ended December 31, 2004 and December 31, 2005 were $11,982 and $11,010,
respectively.
(h) Not Applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
The registrant has a separately designated standing audit committee established
in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934,
as amended. The members of the committee are Enrique R. Arzac, James Cattano,
Steven N. Rappaport and Martin M. Torino.
ITEM 6. SCHEDULE OF INVESTMENTS.
Included as part of the report to shareholders filed under Item 1 of this Form.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
<Page>
CREDIT SUISSE ASSET MANAGEMENT, LLC
CREDIT SUISSE FUNDS
CREDIT SUISSE INSTITUTIONAL FUNDS
CSAM CLOSED-END FUNDS
PROXY VOTING POLICY AND PROCEDURES
Introduction
Credit Suisse Asset Management, LLC ("CSAM") is a fiduciary that owes each
of its clients duties of care and loyalty with respect to proxy voting. The
duty of care requires CSAM to monitor corporate events and to vote proxies.
To satisfy its duty of loyalty, CSAM must cast proxy votes in the best
interests of each of its clients.
The Credit Suisse Funds, Credit Suisse Institutional Funds, and CSAM
Closed-End Funds (the "Funds"), which have engaged Credit Suisse Asset
Management, LLC as their investment adviser, are of the belief that the
proxy voting process is a means of addressing corporate governance issues
and encouraging corporate actions both of which can enhance shareholder
value.
Policy
The Proxy Voting Policy (the "Policy") set forth below is designed to
ensure that proxies are voted in the best interests of CSAM's clients. The
Policy addresses particular issues and gives a general indication of how
CSAM will vote proxies. The Policy is not exhaustive and does not include
all potential issues.
Proxy Voting Committee
The Proxy Voting Committee will consist of a member of the Portfolio
Management Department, a member of the Legal and Compliance Department, and
a member of the Operations Department (or their designees). The purpose of
the Proxy Voting Committee is to administer the voting of all clients'
proxies in accordance with the Policy. The Proxy Voting Committee will
review the Policy annually to ensure that it is designed to promote the
best interests of CSAM's clients.
For the reasons disclosed below under "Conflicts," the Proxy Voting
Committee has engaged the services of an independent third party
(initially, Institutional Shareholder Services ("ISS")) to assist in issue
analysis and vote recommendation for proxy proposals. Proxy proposals
addressed by the Policy will be voted in accordance with the Policy. Proxy
proposals addressed by the Policy that require a case-by-case analysis will
be voted in accordance with the vote
<Page>
recommendation of ISS. Proxy proposals not addressed by the Policy will
also be voted in accordance with the vote recommendation of ISS. To the
extent that the Proxy Voting Committee proposes to deviate from the Policy
or the ISS vote recommendation, the Committee shall obtain client consent
as described below.
CSAM investment professionals may submit a written recommendation to the
Proxy Voting Committee to vote in a manner inconsistent with the Policy
and/or the recommendation of ISS. Such recommendation will set forth its
basis and rationale. In addition, the investment professional must confirm
in writing that he/she is not aware of any conflicts of interest concerning
the proxy matter or provide a full and complete description of the
conflict.
Conflicts
CSAM is the institutional and mutual fund asset management arm of Credit
Suisse First Boston, which is part of Credit Suisse Group, one of the
world's largest financial organizations. As part of a global, full service
investment-bank, broker-dealer, and asset-management organization, CSAM and
its affiliates and personnel may have multiple advisory, transactional,
financial, and other interests in securities, instruments, and companies
that may be purchased or sold by CSAM for its clients' accounts. The
interests of CSAM and/or its affiliates and personnel may conflict with the
interests of CSAM's clients in connection with any proxy issue. In
addition, CSAM may not be able to identify all of the conflicts of interest
relating to any proxy matter.
Consent
In each and every instance in which the Proxy Voting Committee favors
voting in a manner that is inconsistent with the Policy or the vote
recommendation of ISS (including proxy proposals addressed and not
addressed by the Policy), it shall disclose to the client conflicts of
interest information and obtain client consent to vote. Where the client is
a Fund, disclosure shall be made to any one director who is not an
"interested person," as that term is defined under the Investment Company
Act of 1940, as amended, of the Fund.
Recordkeeping
CSAM is required to maintain in an easily accessible place for five years all
records relating to proxy voting.
These records include the following:
- a copy of the Policy;
- a copy of each proxy statement received on behalf of CSAM clients;
<Page>
- a record of each vote cast on behalf of CSAM clients;
- a copy of all documents created by CSAM personnel that were material
to making a decision on a vote or that memorializes the basis for the
decision; and
- a copy of each written request by a client for information on how CSAM
voted proxies, as well as a copy of any written response.
CSAM reserves the right to maintain certain required proxy records with ISS
in accordance with all applicable regulations.
Disclosure
CSAM will describe the Policy to each client. Upon request, CSAM will
provide any client with a copy of the Policy. CSAM will also disclose to
its clients how they can obtain information on their proxy votes.
ISS will capture data necessary for Funds to file Form N-PX on an annual
basis concerning their proxy voting record in accordance with applicable
law.
Procedures
The Proxy Voting Committee will administer the voting of all client
proxies. CSAM has engaged ISS as an independent third party proxy voting
service to assist in the voting of client proxies. ISS will coordinate with
each client's custodian to ensure that proxy materials reviewed by the
custodians are processed in a timely fashion. ISS will provide CSAM with an
analysis of proxy issues and a vote recommendation for proxy proposals. ISS
will refer proxies to the Proxy Voting Committee for instructions when the
application of the Policy is not clear. The Proxy Voting Committee will
notify ISS of any changes to the Policy or deviating thereof.
PROXY VOTING POLICY
Operational Items
Adjourn Meeting
Proposals to provide management with the authority to adjourn an
annual or special meeting will be determined on a case-by-case basis.
Amend Quorum Requirements
Proposals to reduce quorum requirements for shareholder meetings below
a majority of the shares outstanding will be determined on a
case-by-case basis.
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Amend Minor Bylaws
Generally vote for bylaw or charter changes that are of a housekeeping
nature.
Change Date, Time, or Location of Annual Meeting
Generally vote for management proposals to change the
date/time/location of the annual meeting unless the proposed change is
unreasonable. Generally vote against shareholder proposals to change
the date/time/location of the annual meeting unless the current
scheduling or location is unreasonable.
Ratify Auditors
Generally vote for proposals to ratify auditors unless: (1) an auditor
has a financial interest in or association with the company, and is
therefore not independent; (2) fees for non-audit services are
excessive, or (3) there is reason to believe that the independent
auditor has rendered an opinion, which is neither accurate nor
indicative of the company's financial position. Generally vote on a
case-by-case basis on shareholder proposals asking companies to
prohibit their auditors from engaging in non-audit services (or
capping the level of non-audit services). Generally vote on a
case-by-case basis on auditor rotation proposals taking into
consideration: (1) tenure of audit firm; (2) establishment and
disclosure of a renewal process whereby the auditor is regularly
evaluated for both audit quality and competitive price; (3) length of
the rotation period advocated in the proposal, and (4) significant
audit related issues.
Board of Directors
Voting on Director Nominees in Uncontested Elections
Generally votes on director nominees on a case-by-case basis. Votes
may be withheld: (1) from directors who attended less than 75% of the
board and committee meetings without a valid reason for the absences;
(2) implemented or renewed a dead-hand poison pill; (3) ignored a
shareholder proposal that was approved by a majority of the votes cast
for two consecutive years; (4) ignored a shareholder proposal approved
by a majority of the shares outstanding; (5) have failed to act on
takeover offers where the majority of the shareholders have tendered
their shares; (6) are inside directors or affiliated outside directors
and sit on the audit, compensation, or nominating committee; (7) are
inside directors or affiliated outside directors and the full board
serves as the audit, compensation, or nominating committee or the
company does not have one of these committees; or (8) are audit
committee members and the non-audit fees paid to the auditor are
excessive
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Cumulative Voting
Proposals to eliminate cumulative voting will be determined on a
case-by-case basis. Proposals to restore or provide for cumulative
voting in the absence of sufficient good governance provisions and/or
poor relative shareholder returns will be determined on a case-by-case
basis.
Director and Officer Indemnification and Liability Protection
Proposals on director and officer indemnification and liability
protection generally evaluated on a case-by-case basis. Generally vote
against proposals that would: (1) eliminate entirely directors' and
officers' liability for monetary damages for violating the duty of
care; or (2) expand coverage beyond just legal expenses to acts, such
as negligence, that are more serious violations of fiduciary
obligation than mere carelessness. Generally vote for only those
proposals providing such expanded coverage in cases when a director's
or officer's legal defense was unsuccessful if: (1) the director was
found to have acted in good faith and in a manner that he reasonably
believed was in the best interests of the company, and (2) only if the
director's legal expenses would be covered.
Filling Vacancies/Removal of Directors
Generally vote against proposals that provide that directors may be
removed only for cause. Generally vote for proposals to restore
shareholder ability to remove directors with or without cause.
Proposals that provide that only continuing directors may elect
replacements to fill board vacancies will be determined on a
case-by-case basis. Generally vote for proposals that permit
shareholders to elect directors to fill board vacancies.
Independent Chairman (Separate Chairman/CEO)
Generally vote for shareholder proposals requiring the position of
chairman be filled by an independent director unless there are
compelling reasons to recommend against the proposal, including: (1)
designated lead director, elected by and from the independent board
members with clearly delineated duties; (2) 2/3 independent board; (3)
all independent key committees; or (4) established governance
guidelines.
Majority of Independent Directors
Generally vote for shareholder proposals requiring that the board
consist of a majority or substantial majority (two-thirds) of
independent directors unless the board composition already meets the
adequate threshold. Generally vote for shareholder proposals requiring
the board audit, compensation, and/or nominating committees be
composed exclusively of independent directors if they currently do not
meet that standard. Generally withhold votes from insiders and
affiliated outsiders sitting on the audit, compensation, or nominating
committees. Generally withhold votes from insiders and affiliated
outsiders on boards that are
<Page>
lacking any of these three panels. Generally withhold votes from
insiders and affiliated outsiders on boards that are not at least
majority independent.
Term Limits
Generally vote against shareholder proposals to limit the tenure of
outside directors.
Proxy Contests
Voting on Director Nominees in Contested Elections
Votes in a contested election of directors should be decided on a
case-by-case basis, with shareholders determining which directors are
best suited to add value for shareholders. The major decision factors
are: (1) company performance relative to its peers; (2) strategy of
the incumbents versus the dissidents; (3) independence of
directors/nominees; (4) experience and skills of board candidates; (5)
governance profile of the company; (6) evidence of management
entrenchment; (7) responsiveness to shareholders; or (8) whether
takeover offer has been rebuffed.
Amend Bylaws without Shareholder Consent
Proposals giving the board exclusive authority to amend the bylaws
will be determined on a case-by-case basis. Proposals giving the board
the ability to amend the bylaws in addition to shareholders will be
determined on a case-by-case basis.
Confidential Voting
Generally vote for shareholder proposals requesting that corporations
adopt confidential voting, use independent vote tabulators and use
independent inspectors of election, as long as the proposal includes a
provision for proxy contests as follows: In the case of a contested
election, management should be permitted to request that the dissident
group honor its confidential voting policy. If the dissidents agree,
the policy may remain in place. If the dissidents will not agree, the
confidential voting policy may be waived. Generally vote for
management proposals to adopt confidential voting.
Cumulative Voting
Proposals to eliminate cumulative voting will be determined on a
case-by-case basis. Proposals to restore or provide for cumulative
voting in the absence of sufficient good governance provisions and/or
poor relative shareholder returns will be determined on a case-by-case
basis.
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Antitakeover Defenses and Voting Related Issues
Advance Notice Requirements for Shareholder Proposals/Nominations
Votes on advance notice proposals are determined on a case-by-case
basis.
Amend Bylaws without Shareholder Consent
Proposals giving the board exclusive authority to amend the bylaws
will be determined on a case-by-case basis. Generally vote for
proposals giving the board the ability to amend the bylaws in addition
to shareholders.
Poison Pills (Shareholder Rights Plans)
Generally vote for shareholder proposals requesting that the company
submit its poison pill to a shareholder vote or redeem it. Votes
regarding management proposals to ratify a poison pill should be
determined on a case-by-case basis. Plans should embody the following
attributes: (1) 20% or higher flip-in or flip-over; (2) two to three
year sunset provision; (3) no dead-hand or no-hand features; or (4)
shareholder redemption feature
Shareholders' Ability to Act by Written Consent
Generally vote against proposals to restrict or prohibit shareholders'
ability to take action by written consent. Generally vote for
proposals to allow or make easier shareholder action by written
consent.
Shareholders' Ability to Call Special Meetings
Proposals to restrict or prohibit shareholders' ability to call
special meetings or that remove restrictions on the right of
shareholders to act independently of management will be determined on
a case-by-case basis.
Supermajority Vote Requirements
Proposals to require a supermajority shareholder vote will be
determined on a case-by-case basis Proposals to lower supermajority
vote requirements will be determined on a case-by-case basis.
Merger and Corporate Restructuring
Appraisal Rights
Generally vote for proposals to restore, or provide shareholders with,
rights of appraisal.
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Asset Purchases
Generally vote case-by-case on asset purchase proposals, taking into
account: (1) purchase price, including earnout and contingent
payments; (2) fairness opinion; (3) financial and strategic benefits;
(4) how the deal was negotiated; (5) conflicts of interest; (6) other
alternatives for the business; or (7) noncompletion risk (company's
going concern prospects, possible bankruptcy).
Asset Sales
Votes on asset sales should be determined on a case-by-case basis
after considering: (1) impact on the balance sheet/working capital;
(2) potential elimination of diseconomies; (3) anticipated financial
and operating benefits; (4) anticipated use of funds; (5) value
received for the asset; fairness opinion (if any); (6) how the deal
was negotiated; or (6) Conflicts of interest
Conversion of Securities
Votes on proposals regarding conversion of securities are determined
on a case-by-case basis. When evaluating these proposals, should
review (1) dilution to existing shareholders' position; (2) conversion
price relative to market value; (3) financial issues: company's
financial situation and degree of need for capital; effect of the
transaction on the company's cost of capital; (4) control issues:
change in management; change in control; standstill provisions and
voting agreements; guaranteed contractual board and committee seats
for investor; veto power over certain corporate actions; (5)
termination penalties; (6) conflict of interest: arm's length
transactions, managerial incentives. Generally vote for the conversion
if it is expected that the company will be subject to onerous
penalties or will be forced to file for bankruptcy if the transaction
is not approved.
Corporate Reorganization
Votes on proposals to increase common and/or preferred shares and to
issue shares as part of a debt restructuring plan are determined on a
case-by-case basis, after evaluating: (1) dilution to existing
shareholders' position; (2) terms of the offer; (3) financial issues;
(4) management's efforts to pursue other alternatives; (5) control
issues; (6) conflict of interest. Generally vote for the debt
restructuring if it is expected that the company will file for
bankruptcy if the transaction is not approved.
Reverse Leveraged Buyouts
Votes on proposals to increase common and/or preferred shares and to
issue shares as part of a debt restructuring plan are determined on a
case-by-case basis, after evaluating: (1) dilution to existing
shareholders' position; (2) terms of the offer; (3) financial issues;
(4) management's efforts to pursue other alternatives; (5) control
issues; (6) conflict of interest. Generally vote
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for the debt restructuring if it is expected that the company will
file for bankruptcy if the transaction is not approved.
Formation of Holding Company
Votes on proposals regarding the formation of a holding company should
be determined on a case-by-case basis taking into consideration: (1)
the reasons for the change; (2) any financial or tax benefits; (3)
regulatory benefits; (4) increases in capital structure; (5) changes
to the articles of incorporation or bylaws of the company. Absent
compelling financial reasons to recommend the transaction, generally
vote against the formation of a holding company if the transaction
would include either of the following: (1) increases in common or
preferred stock in excess of the allowable maximum as calculated a
model capital structure; (2) adverse changes in shareholder rights;
(3) going private transactions; (4) votes going private transactions
on a case-by-case basis, taking into account: (a) offer price/premium;
(b) fairness opinion; (c) how the deal was negotiated; (d) conflicts
of interest; (e) other alternatives/offers considered; (f)
noncompletion risk.
Joint Ventures
Vote on a case-by-case basis on proposals to form joint ventures,
taking into account: (1) percentage of assets/business contributed;
(2) percentage ownership; (3) financial and strategic benefits; (4)
governance structure; (5) conflicts of interest; (6) other
alternatives; (7) noncompletion risk; (8) liquidations. Votes on
liquidations should be determined on a case-by-case basis after
reviewing: (1) management's efforts to pursue other alternatives such
as mergers; (2) appraisal value of the assets (including any fairness
opinions); (3) compensation plan for executives managing the
liquidation. Generally vote for the liquidation if the company will
file for bankruptcy if the proposal is not approved.
Mergers and Acquisitions
Votes on mergers and acquisitions should be considered on a
case-by-case basis, determining whether the transaction enhances
shareholder value by giving consideration to: (1) prospects of the
combined companies; (2) anticipated financial and operating benefits;
(3) offer price; (4) fairness opinion; (5) how the deal was
negotiated; (6) changes in corporate governance and their impact on
shareholder rights; (7) change in the capital structure; (8) conflicts
of interest.
Private Placements
Votes on proposals regarding private placements should be determined
on a case-by-case basis. When evaluating these proposals, should
review: (1) dilution to existing shareholders' position; (2) terms of
the offer; (3) financial issues; (4) management's efforts to pursue
alternatives such as mergers; (5) control issues; (6) conflict of
interest. Generally vote for the
<Page>
private placement if it is expected that the company will file for
bankruptcy if the transaction is not approved.
Prepackaged Bankruptcy Plans
Votes on proposals to increase common and/or preferred shares and to
issue shares as part of a debt restructuring plan are determined on a
case-by-case basis, after evaluating: (1) dilution to existing
shareholders' position; (2) terms of the offer; (3) financial issues;
(4) management's efforts to pursue other alternatives; (5) control
issues; (6) conflict of interest. Generally vote for the debt
restructuring if it is expected that the company will file for
bankruptcy if the transaction is not approved.
Recapitalization
Votes case-by-case on recapitalizations (reclassifications of
securities), taking into account: (1) more simplified capital
structure; (2) enhanced liquidity; (3) fairness of conversion terms,
including fairness opinion; (4) impact on voting power and dividends;
(5) reasons for the reclassification; (6) conflicts of interest; (7)
other alternatives considered.
Reverse Stock Splits
Generally vote for management proposals to implement a reverse stock
split when the number of authorized shares will be proportionately
reduced. Generally vote for management proposals to implement a
reverse stock split to avoid delisting. Votes on proposals to
implement a reverse stock split that do not proportionately reduce the
number of shares authorized for issue should be determined on a
case-by-case basis.
Spinoffs
Votes on spinoffs should be considered on a case-by-case basis
depending on: (1) tax and regulatory advantages; (2) planned use of
the sale proceeds; (3) valuation of spinoff; fairness opinion; (3)
benefits that the spinoff may have on the parent company including
improved market focus; (4) conflicts of interest; managerial
incentives; (5) any changes in corporate governance and their impact
on shareholder rights; (6) change in the capital structure
Value Maximization Proposals
Vote case-by-case on shareholder proposals seeking to maximize
shareholder value.
Capital Structure
Adjustments to Par Value of Common Stock
<Page>
Generally vote for management proposals to reduce the par value of
common stock unless the action is being taken to facilitate an
antitakeover device or some other negative corporate governance
action. Generally vote for management proposals to eliminate par
value.
Common Stock Authorization
Votes on proposals to increase the number of shares of common stock
authorized for issuance are determined on a case-by-case basis.
Generally vote against proposals at companies with dual-class capital
structures to increase the number of authorized shares of the class of
stock that has superior voting rights. Generally vote for proposals to
approve increases beyond the allowable increase when a company's
shares are in danger of being delisted or if a company's ability to
continue to operate as a going concern is uncertain.
Dual-class Stock
Generally vote against proposals to create a new class of common stock
with superior voting rights. Generally vote for proposals to create a
new class of nonvoting or subvoting common stock if: (1) it is
intended for financing purposes with minimal or no dilution to current
shareholders; (2) it is not designed to preserve the voting power of
an insider or significant shareholder.
Issue Stock for Use with Rights Plan
Generally vote against proposals that increase authorized common stock
for the explicit purpose of implementing a shareholder rights plan.
Preemptive Rights
Votes regarding shareholder proposals seeking preemptive rights should
be determined on a case-by-case basis after evaluating: (1) the size
of the company; (2) the shareholder base; (3) the liquidity of the
stock
Preferred Stock
Generally vote against proposals authorizing the creation of new
classes of preferred stock with unspecified voting, conversion,
dividend distribution, and other rights ("blank check" preferred
stock). Generally vote for proposals to create "declawed" blank check
preferred stock (stock that cannot be used as a takeover defense).
Generally vote for proposals to authorize preferred stock in cases
where the company specifies the voting, dividend, conversion, and
other rights of such stock and the terms of the preferred stock appear
reasonable. Generally vote against proposals to increase the number of
blank check preferred stock authorized for issuance when no shares
have been issued or reserved for a specific purpose. Generally vote
case-by-case on proposals to increase the number of blank check
<Page>
preferred shares after analyzing the number of preferred shares
available for issue given a company's industry and performance in
terms of shareholder returns.
Recapitalization
Vote case-by-case on recapitalizations (reclassifications of
securities), taking into account: (1) more simplified capital
structure; (2) enhanced liquidity; (3) fairness of conversion terms,
including fairness opinion; (4) impact on voting power and dividends;
(5) reasons for the reclassification; (6) conflicts of interest; (7)
other alternatives considered.
Reverse Stock Splits
Generally vote for management proposals to implement a reverse stock
split when the number of authorized shares will be proportionately
reduced. Generally vote for management proposals to implement a
reverse stock split to avoid delisting. Votes on proposals to
implement a reverse stock split that do not proportionately reduce the
number of shares authorized for issue should be determined on a
case-by-case basis.
Share Repurchase Programs
Generally vote for management proposals to institute open-market share
repurchase plans in which all shareholders may participate on equal
terms.
Stock Distributions: Splits and Dividends
Generally vote for management proposals to increase the common share
authorization for a stock split or share dividend, provided that the
increase in authorized shares would not result in an excessive number
of shares available for issuance.
Tracking Stock
Votes on the creation of tracking stock are determined on a
case-by-case basis, weighing the strategic value of the transaction
against such factors as: (1) adverse governance changes; (2) excessive
increases in authorized capital stock; (3) unfair method of
distribution; (4) diminution of voting rights; (5) adverse conversion
features; (6) negative impact on stock option plans; (7) other
alternatives such as a spinoff.
Executive and Director Compensation
Executive and Director Compensation
Votes on compensation plans for directors are determined on a
case-by-case basis.
<Page>
Stock Plans in Lieu of Cash
Votes for plans which provide participants with the option of taking
all or a portion of their cash compensation in the form of stock are
determined on a case-by-case basis. Generally vote for plans which
provide a dollar-for-dollar cash for stock exchange. Votes for plans
which do not provide a dollar-for-dollar cash for stock exchange
should be determined on a case-by-case basis.
Director Retirement Plans
Generally vote against retirement plans for nonemployee directors.
Generally vote for shareholder proposals to eliminate retirement plans
for nonemployee directors.
Management Proposals Seeking Approval to Reprice Options
Votes on management proposals seeking approval to reprice options are
evaluated on a case-by-case basis giving consideration to the
following: (1) historic trading patterns; (2) rationale for the
repricing; (3) value-for-value exchange; (4) option vesting; (5) term
of the option; (6) exercise price; (7) participants; (8) employee
stock purchase plans. Votes on employee stock purchase plans should be
determined on a case-by-case basis. Generally vote for employee stock
purchase plans where: (1) purchase price is at least 85 percent of
fair market value; (2) offering period is 27 months or less, and (3)
potential voting power dilution (VPD) is ten percent or less.
Generally vote against employee stock purchase plans where either: (1)
purchase price is less than 85 percent of fair market value; (2)
Offering period is greater than 27 months, or (3) VPD is greater than
ten percent
Incentive Bonus Plans and Tax Deductibility Proposals
Generally vote for proposals that simply amend shareholder-approved
compensation plans to include administrative features or place a cap
on the annual grants any one participant may receive. Generally vote
for proposals to add performance goals to existing compensation plans.
Votes to amend existing plans to increase shares reserved and to
qualify for favorable tax treatment considered on a case-by-case
basis. Generally vote for cash or cash and stock bonus plans that are
submitted to shareholders for the purpose of exempting compensation
from taxes if no increase in shares is requested.
Employee Stock Ownership Plans (ESOPs)
Generally vote for proposals to implement an ESOP or increase
authorized shares for existing ESOPs, unless the number of shares
allocated to the ESOP is excessive (more than five percent of
outstanding shares.)
401(k) Employee Benefit Plans
<Page>
Generally vote for proposals to implement a 401(k) savings plan for
employees.
Shareholder Proposals Regarding Executive and Director Pay
Generally vote for shareholder proposals seeking additional disclosure
of executive and director pay information, provided the information
requested is relevant to shareholders' needs, would not put the
company at a competitive disadvantage relative to its industry, and is
not unduly burdensome to the company. Generally vote against
shareholder proposals seeking to set absolute levels on compensation
or otherwise dictate the amount or form of compensation. Generally
vote against shareholder proposals requiring director fees be paid in
stock only. Generally vote for shareholder proposals to put option
repricings to a shareholder vote. Vote for shareholders proposals to
exclude pension fund income in the calculation of earnings used in
determining executive bonuses/compensation. Vote on a case-by-case
basis for all other shareholder proposals regarding executive and
director pay, taking into account company performance, pay level
versus peers, pay level versus industry, and long term corporate
outlook.
Performance-Based Option Proposals
Generally vote for shareholder proposals advocating the use of
performance-based equity awards (indexed, premium-priced, and
performance-vested options), unless: (1) the proposal is overly
restrictive; or (2) the company demonstrates that it is using a
substantial portion of performance-based awards for its top
executives.
Stock Option Expensing
Generally vote for shareholder proposals asking the company to expense
stock options unless the company has already publicly committed to
start expensing by a specific date.
Golden and Tin Parachutes
Generally vote for shareholder proposals to require golden and tin
parachutes to be submitted for shareholder ratification, unless the
proposal requires shareholder approval prior to entering into
employment contracts. Vote on a case-by-case basis on proposals to
ratify or cancel golden or tin parachutes.
May 17, 2005
<Page>
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Information pertaining to the Chief Investment Officer of The Latin America
Equity Fund, Inc., as of December 31, 2005, is set forth below.
Matthew Hickman Director of Credit Suisse; Financial Advisor
Chief Investment Officer with Global Advisors from July 2003 to November
Since 2004 2003; General Manager of Compass Group
Investment Advisors S.A. from February 2002 to
Date of Birth: 01/21/64 July 2003; Financial Advisor with Credit Suisse
First Boston from August 2000 to February 2002;
Director of ABN AMRO from September 1998 to
August 2000; Officer of other Credit Suisse
Funds
Registered Investment Companies, Pooled Investment Vehicles and Other
Accounts Managed
As reported to the Registrant, the information in the
following table reflects the number of registered investment companies, pooled
investment vehicles and other accounts managed by Matthew Hickman and the total
assets managed within each category as of December 31, 2005.
<Table>
<Caption>
REGISTERED INVESTMENT OTHER POOLED INVESTMENT
COMPANIES VEHICLES OTHER ACCOUNTS
--------------------------------------------------------------------
4 $ 589 million 1 $ 76 million 0 N/A
</Table>
No advisory fee is paid based on performance for any of the
accounts listed above.
Potential Conflicts of Interest
It is possible that conflicts of interest may arise in
connection with the portfolio managers' management of the Portfolio's
investments on the one hand and the investments of other accounts on the other.
For example, the portfolio managers may have conflicts of interest in allocating
management time, resources and investment opportunities among the Portfolio and
other accounts they advise. In addition due to differences in the investment
strategies or restrictions between the Portfolio and the other accounts, the
portfolio managers may take action with respect to another account that differs
from the action taken with respect to the Portfolio. Credit Suisse has adopted
policies and procedures that are designed to minimize the effects of these
conflicts.
If Credit Suisse believes that the purchase or sale of a
security is in the best interest of more than one client, it may (but is not
obligated to) aggregate the orders to be sold or purchased to seek favorable
execution or lower brokerage commissions, to the extent permitted by applicable
laws and regulations. Credit Suisse may aggregate orders if all participating
client accounts benefit equally
<Page>
(i.e., all receive an average price of the aggregated orders). In the event
Credit Suisse aggregates an order for participating accounts, the method of
allocation will generally be determined prior to the trade execution. Although
no specific method of allocation of transactions (as well as expenses incurred
in the transactions) is expected to be used, allocations will be designed to
ensure that over time all clients receive fair treatment consistent with Credit
Suisse's fiduciary duty to its clients (including its duty to seek to obtain
best execution of client trades). The accounts aggregated may include registered
and unregistered investment companies managed by Credit Suisse's affiliates and
accounts in which Credit Suisse's officers, directors, agents, employees or
affiliates own interests. Applicant may not be able to aggregate securities
transactions for clients who direct the use of a particular broker-dealer, and
the client also may not benefit from any improved execution or lower commissions
that may be available for such transactions.
Compensation
Matthew Hickman is compensated for his services by Credit
Suisse. His compensation consists of a fixed base salary and a discretionary
bonus that is not tied by formula to the performance of any fund or account. The
factors taken into account in determining his bonus include the Fund's
performance, assets held in the Fund and other accounts managed by the portfolio
managers, business growth, team work, management, corporate citizenship, etc. A
portion of the bonus may be paid in phantom shares of Credit Suisse Group stock
as deferred compensation. Like all employees of Credit Suisse, these portfolio
managers participate in Credit Suisse's profit sharing and 401(k) plans.
Securities Ownership. As of December 31, 2005, Mr. Hickman did not own any
shares of the registrant.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
None.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which shareholders may
recommend nominees to the registrant's board of directors since the registrant
last provided disclosure in response to the requirements of Item 7(d)(2)(ii)(g)
of Schedule 14A in its definitive proxy statement dated March 1, 2005.
ITEM 11. CONTROLS AND PROCEDURES.
<Page>
(a) As of a date within 90 days from the filing date of this report, the
principal executive officer and principal financial officer concluded that the
registrant's disclosure controls and procedures (as defined in Rule 30a-3(c)
under the Investment Company Act of 1940 (the "Act")) were effective based on
their evaluation of the disclosure controls and procedures required by Rule
30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities
Exchange Act of 1934.
(b) There were no changes in registrant's internal control over financial
reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the
second fiscal quarter of the period covered by this report that have materially
affected, or are reasonably likely to materially affect, the registrant's
internal control over financial reporting.
ITEM 12. EXHIBITS.
(a)(1) Registrant's Code of Ethics is an exhibit to this report.
(a)(2) The certifications of the registrant as required by Rule 30a-2(a) under
the Act are exhibits to this report.
(a)(3) Not applicable.
(b) The certifications of the registrant as required by Rule 30a-2(b) under
the Act are an exhibit to this report.
<Page>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934 and the Investment Company Act of 1940, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.
THE LATIN AMERICA EQUITY FUND, INC.
/s/ Steven B. Plump
-------------------
Name: Steven B. Plump
Title: Chief Executive Officer
Date: March 9, 2006
Pursuant to the requirements of the Securities Exchange Act of
1934 and the Investment Company Act of 1940, this report has been signed below
by the following persons on behalf of the registrant and in the capacities and
on the dates indicated.
/s/ Steven B. Plump
-------------------
Name: Steven B. Plump
Title: Chief Executive Officer
Date: March 9, 2006
/s/ Michael A. Pignataro
------------------------
Name: Michael A. Pignataro
Title: Chief Financial Officer
Date: March 9, 2006