Fund Description: iShares Emerging Markets Local Currency Bond ETF is an exchange-traded index fund or Index ETF which is a separate investment portfolio of iShares Inc., an open-end investment management company. INVESTMENT OBJECTIVE: The iShares Emerging Markets Local Currency Bond ETF seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Barclays Capital Emerging Markets Broad Local Currency Bond Index. INDEX DESCRIPTION: The Barclays Capital Emerging Markets Broad Local Currency Bond Index measures the performance of local currency-denominated sovereign bond markets of emerging market countries. As of September 30, 2011, there were 289 issues in the Index. Securities included in the Index must be issued by countries that satisfy certain eligibility requirements for emerging market countries, and meet separate security-specific requirements. Eligible issuer countries must have a sovereign rating of A1/A+ or lower using the middle foreign currency long-term debt rating of Moody’s Investors Service, Inc., Standard & Poor’s or Fitch, Inc. or be classified by the World Bank as a Low, Low/Middle or Upper/Middle Income country. Countries that are part of the euro area are excluded from the Index, regardless of their rating or World Bank classification. Eligible issuer countries must also have at least the local currency equivalent of US $5 billion face amount of aggregate local currency treasury debt with maturities greater than one year outstanding as of July 1 of the preceding year. Each security issued by an eligible emerging market country included in the must separately have the local currency equivalent of US $1 billion face amount outstanding and meet certain pricing and maturity requirements. Treasury bills and strips, floating-rate issues, inflation-linked bonds, dual currency bonds, and private placements are excluded from the Index. As of September 30, 2011, the Index included securities issued by Brazil, Chile, Colombia, the Czech Republic, Egypt, Hungary, Indonesia, Israel, Malaysia, Mexico, Peru, the Philippines, Poland, Russia, South Africa, South Korea, Thailand and Turkey. FUND STRATEGY: A passive or indexing approach is used to try to achieve the Fund's investment objective. Unlike many investment companies, the Fund does not try to beat the Index and does not seek temporary defensive positions when markets decline or appear overvalued. Indexing may eliminate the chance that the Fund will substantially outperform its Index but also may reduce some of the risks of active management, such as poor security selection. Indexing seeks to achieve lower costs and better after-tax performance by keeping portfolio turnover low in comparison to actively managed investment companies. The Fund generally invests at least 80% of its assets in securities of the Index and in depositary receipts representing securities of the Index. The Fund may invest the remainder of its assets in securities not included in the Index, but is believed will help the Fund track the Index, and in futures contracts, options on futures contracts, options and swaps as well as cash and cash equivalents, including shares of money market funds. Representative sampling is an indexing strategy that is used which involves investing in a representative sample of securities that collectively has an investment profile similar to the Index. The securities selected are expected to have, in the aggregate, investment characteristics (based on factors such as market capitalization and industry weightings), fundamental characteristics (such as return variability and yield) and liquidity measures similar to those of the Index. A Fund may or may not hold all of the securities in the Index. FUND MANAGEMENT: BlackRock Fund Advisors (BFA) serves as the Investment Adviser to the Fund and has overall responsibility for the general management and administration of the Company with the Portfolio Managers primarily responsible for the day-to-day management of the Fund.