Fund Description: iShares MSCI Japan Small Cap ETF, formerly iShares MSCI Japan Small Cap Index Fund, is an exchange-traded index fund or Index ETF which is a separate investment portfolio of the iShares Trust, an open-end investment management company. INVESTMENT OBJECTIVE: The iShares MSCI Japan Small Cap ETF seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the MSCI Japan Small Cap Index. INDEX DESCRIPTION: The MSCI Japan Small Cap Index is sponsored by MSCI, Inc.(Index Provider), an organization that is independent of the Fund. MSCI determines the relative weightings of the securities in the Index and publishes information regarding the market value of the Index. The Index targets 40% of the eligible small cap universe within each industry group in the MSCI Japan Index, which consists of stocks traded primarily on the Tokyo Stock Exchange. MSCI defines the small cap universe as all listed securities that have a market capitalization in the range of $200-$1,500 million. As of September 30, 2007, the Index’s three largest industries were energy, utilities and telecommunication services. FUND STRATEGY: The Fund will generally invest at least 90% of its assets in the securities of its Index or in Depositary Receipts representing securities in the Index. The Fund may invest the remainder of its assets in securities not included in its Index, but which believes will help the Fund track its Index. The Fund may also invest its other assets in futures contracts, options on futures contracts, and swaps related to its Index, as well as cash and cash equivalents, including shares of money market funds. Using a representative sampling which is an indexing strategy that involves investing in a representative sample of securities that collectively have 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. The Fund may or may not hold all of the securities that are included in the Index. FUND MANAGEMENT: BlackRock Fund Advisors (BFA) serves as the investment advisor to the Fund.