The Board of Directors and Shareholders

International Speedway Corporation

We have audited the accompanying consolidated balance sheets of International Speedway Corporation and subsidiaries as of November 30, 2002 and 2003, and the related consolidated statements of operations, shareholders' equity and cash flows (restated) for each of the three years in the period ended November 30, 2003. Our audits also included the financial statement schedule listed in the index. These financial statements and schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

We conducted our audits in accordance with the Standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of International Speedway Corporation and subsidiaries at November 30, 2002 and 2003, and the consolidated results of their operations and their cash flows (restated) for each of the three years in the period ended November 30, 2003, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

As discussed in Note 2 to the consolidated financial statements, the Company adopted Statement of Financial Accounting Standards No. 142 in 2002.

 

/s/ Ernst & Young LLP

 

Jacksonville, Florida
January 15, 2004, except for Note 19, as to which the date is August 9, 2004

INTERNATIONAL SPEEDWAY CORPORATION
Consolidated Balance Sheets
				November 30,
				2002		2003
				(In Thousands)
ASSETS
Current Assets:
	Cash and cash equivalents			$	109,263	$	223,973
	Short-term investments				200		201
	Receivables, less allowance of $1,500 in 2002 and 2003				30,557		37,996
	Inventories				4,799		5,496
	Prepaid expenses and other current assets				3,784		4,078
Total Current Assets					148,603		271,744
Property and Equipment, net					859,096		884,623
Other Assets:
	Equity investments				31,152		33,706
	Goodwill				92,542		92,542
	Other				24,578		21,177
					148,272		147,425
Total Assets				$	1,155,971	$	1,303,792
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
	Current portion of long-term debt			$	5,775	$	232,963
	Accounts payable				17,506		15,739
	Deferred income				98,315		106,998
	Income taxes payable				3,939		6,877
	Other current liabilities				10,968		13,928
Total Current Liabilities					136,503		376,505
Long-Term Debt					309,606		75,168
Deferred Income Taxes					74,943		113,414
Long-Term Deferred Income					11,709		11,894
Other Long-Term Liabilities					885		346
Commitments and Contingencies					-		-
Shareholders' Equity:
	Class A Common Stock, $.01 par value, 80,000,000 shares authorized;
		25,319,221 and 28,359,173 issued and outstanding in 2002 and 2003, respectively			253		283
	Class B Common Stock, $.01 par value, 40,000,000 shares authorized;
		27,867,456 and 24,858,610 issued and outstanding in 2002 and 2003, respectively			279		249
	Additional paid-in capital				693,463		694,719
	Retained (deficit) earnings				(67,641)		34,602
	Accumulated other comprehensive loss				(874)		(333)
					625,480		729,520
	Less unearned compensation-restricted stock				3,155		3,055
Total Shareholders' Equity					622,325		726,465
Total Liabilities and Shareholders' Equity				$	1,155,971	$	1,303,792

See accompanying notes

See accompanying notes

See accompanying notes

See accompanying notes

See accompanying notes

INTERNATIONAL SPEEDWAY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOVEMBER 30, 2003

NOTE 1 - DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

DESCRIPTION OF BUSINESS: International Speedway Corporation, including its wholly‑owned subsidiaries (collectively the "Company"), is a leading promoter of motorsports entertainment activities in the United States. As of November 30, 2003, the Company owned and/or operated twelve of the nations major motorsports facilities as follows:

Track Name	Location	Track Length
Daytona International Speedway	Daytona Beach, Florida	2.5 Miles
Talladega Superspeedway	Talladega, Alabama	2.6 Miles
Michigan International Speedway	Brooklyn, Michigan	2.0 Miles
Richmond International Raceway	Richmond, Virginia	0.8 Miles
California Speedway	Fontana, California	2.0 Miles
Kansas Speedway	Kansas City, Kansas	1.5 Miles
Phoenix International Raceway	Phoenix, Arizona	1.0 Mile
Homestead-Miami Speedway	Homestead, Florida	1.5 Miles
North Carolina Speedway	Rockingham, North Carolina	1.0 Mile
Darlington Raceway	Darlington, South Carolina	1.3 Miles
Watkins Glen International	Watkins Glen, New York	3.4 Miles
Nazareth Speedway	Nazareth, Pennsylvania	1.0 Mile

In addition, Raceway Associates, LLC (Raceway Associates), in which the Company holds a 37.5% indirect equity interest, owns and operates Chicagoland Speedway and Route 66 Raceway, two nationally recognized major motorsports facilities in Joliet, Illinois.

In fiscal 2003, these motorsports facilities promoted well over 100 stock car, open wheel, sports car, truck, motorcycle and other racing events, including 20 National Association for Stock Car Auto Racing (NASCAR) Winston Cup Series events, 16 NASCAR Busch Series events, eight NASCAR Craftsman Truck Series events, eight Indy Racing League (IRL) IndyCar Series events, two National Hot Rod Association (NHRA) National events, the premier sports car event in the United States (the Rolex 24 at Daytona sanctioned by the Grand American Road Racing Association (Grand American) and a number of prestigious motorcycle events.

The Companys business consists principally of racing events at these major motorsports facilities, which, in total, currently have more than one million grandstand seats. The Company also conducts, either through operations of the particular facility or through certain wholly-owned subsidiaries operating under the name Americrown, souvenir merchandising operations, food and beverage concession operations and catering services to customers both in suites and chalets at all of the Companys motorsports facilities. Americrown also produces and markets motorsports-related merchandise such as apparel, souvenirs and collectibles to retail customers, through internet and catalog sales and directly to dealers.

MRN Radio, the Company's proprietary radio network, produces and syndicates to radio stations the NASCAR Winston Cup, NASCAR Busch and NASCAR Craftsman Truck series races and certain other races promoted by the Company, as well as some races promoted by others. In addition, MRN Radio provides production services for Winston Cup Vision, the trackside large screen video display units, at all NASCAR Winston Cup Series races except at Indianapolis Motor Speedway, which is a track not owned by the Company. MRN Radio also produces and syndicates daily and weekly NASCAR racing-themed programs.

The Company owns and operates DAYTONA USA - The Ultimate Motorsports Attraction, a motorsports-themed entertainment complex and the Official Attraction of NASCAR that includes interactive media, theaters, historical memorabilia and exhibits, tours, as well as riding and driving experiences of Daytona International Speedway.

SIGNIFICANT ACCOUNTING POLICIES:

PRINCIPLES OF CONSOLIDATION: The accompanying consolidated financial statements include the accounts of International Speedway Corporation and its wholly-owned subsidiaries. All material intercompany accounts and transactions have been eliminated in consolidation.

CASH AND CASH EQUIVALENTS: For purposes of reporting cash flows, cash and cash equivalents include cash on hand, bank demand deposit accounts and repurchase agreements. Cash and cash equivalents exclude certificates of deposit regardless of original maturity.

The Company maintained its cash primarily with two financial institutions at November 30, 2003. The Company believes that it is not exposed to any significant credit risk on its cash balances due to the strength of the financial institutions.

RECEIVABLES: Receivables are stated at their estimated collectible amounts. The allowance for doubtful accounts is estimated based on historical experience of write offs and future expectations of conditions that might impact the collectibility of accounts.

INVENTORIES: Inventories of items for resale are stated at the lower of cost, determined on the first‑in, first‑out basis, or market.

PROPERTY AND EQUIPMENT: Property and equipment, including improvements to existing facilities, are stated at cost. Depreciation is provided for financial reporting purposes using the straight‑line method over the estimated useful lives as follows:

Buildings, grandstands and tracks 5‑34 years

Furniture and equipment 3‑20 years

The carrying values of property and equipment are evaluated for impairment based upon expected future undiscounted cash flows. If events or circumstances indicate that the carrying value of an asset may not be recoverable, an impairment loss would be recognized equal to the difference between the carrying value of the asset and its fair value.

EQUITY INVESTMENTS: Equity investments are accounted for using the equity method of accounting. The Company's equity in the net income from equity investments is recorded as income with a corresponding increase in the investment. Dividends received reduce the investment. The Company recognizes the effects of transactions involving the sale or distribution by an equity investee of its common stock as capital transactions.

Equity investments consist of the Company's interest in Motorsports Alliance, LLC (Motorsports Alliance) (owned 50% by the Company and 50% by Indianapolis Motor Speedway Corp.), which owns a 75% interest in Raceway Associates. Raceway Associates owns and operates Chicagoland Speedway and Route 66 Raceway.

The Companys share of undistributed equity in the earnings from equity investments included in retained earnings at November 30, 2002 and 2003 was approximately $40,000 and $2.6 million, respectively.

GOODWILL AND INTANGIBLE ASSETS: On December 1, 2001, the Company adopted Statement of Financial Accounting Standard (SFAS) No. 142, Goodwill and Other Intangible Assets. Under SFAS No. 142 the Companys goodwill and other intangible assets are evaluated annually, in its fiscal fourth quarter, based upon expected future discounted cash flows at the reporting unit level. Prior to the adoption of SFAS No. 142, goodwill was amortized by the straight‑line method over 40 years.

DEFERRED FINANCING FEES: Deferred financing fees are amortized over the term of the related debt and are included in other non-current assets.

DERIVATIVE FINANCIAL INSTRUMENTS: From time to time the Company uses interest rate swap agreements to minimize the impact of interest rate fluctuations on certain long-term borrowings with fixed and floating interest rates. The differential paid or received on interest rate swap agreements is recognized as an adjustment to interest expense.

INCOME TAXES: Income taxes have been provided using the liability method. Under this method, deferred tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse.

REVENUE RECOGNITION/DEFERRED INCOME: Admission income and all race‑related revenue is earned upon completion of an event and is stated net of admission and sales taxes collected. Advance ticket sales and all race‑related revenue on future events are deferred until earned. Revenues from the sale of merchandise to retail customers, internet and catalog sales, and direct sales to dealers are recognized at the time of the sale.

Kansas Speedway Corporation ("KSC") offers Founding Fan Preferred Access Speedway Seating ("PASS") agreements, which give purchasers the exclusive right and obligation to purchase KSC season-ticket packages for certain sanctioned racing events annually for thirty years under specified terms and conditions. Among the conditions, licensees are required to purchase all season-ticket packages when and as offered each year. Founding Fan PASS agreements automatically terminate without refund should owners not purchase any offered season tickets.

Net fees received under PASS agreements are deferred and are amortized into income over 30 years, the term of the agreements. Long-term deferred income under the PASS agreements total approximately $11.5 million and $11.1 million at November 30, 2002 and 2003, respectively.

ADVERTISING EXPENSE: Advertising costs are expensed as incurred or, as in the case of race‑related advertising, upon the completion of the event. Race-related advertising included in prepaid expenses and other current assets at November 30, 2002 and 2003 was approximately $360,000 and $419,000, respectively. Advertising expense was approximately $10.7 million, $10.8 million and $11.2 million for the years ended November 30, 2001, 2002 and 2003, respectively.

LOSS CONTINGENCIES: Legal and other costs incurred in conjunction with loss contingencies are expensed as incurred.

STOCK-BASED COMPENSATION: The Company has a long-term incentive stock plan, which is described more fully in Note 14. The Company accounts for its long-term incentive stock plan under the recognition and measurement principles of Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to Employees, and related interpretations. The Company recognizes stock-based employee compensation cost on its restricted shares awarded over their vesting periods in an amount equal to the fair market value of these shares on the date of award. No stock-based employee compensation cost is reflected in net income (loss) relating to stock options as all options granted under the plan have an exercise price equal to the market value of the underlying common stock on the date of grant.

The following table illustrates the effect on net income (loss) and earnings (loss) per share if the Company had applied the fair value recognition provisions of SFAS No. 123, Accounting for Stock-Based Compensation, to stock based employee compensation for the years ended November 30 (in thousands, except per share amounts):

	2001	2002	2003
Net income (loss), as reported	$ 87,633	$ (410,978)	$ 105,448
Add: Stock-based employee compensation
expense included in reported net income
(loss), net of related tax effects	996	912	1,034
Deduct: Total stock-based employee
compensation expense determined under
fair value based method for all awards, net
of related tax effects	(1,157)	(1,133)	(1,256)
Pro forma net income (loss)	$ 87,472	$ (411,199)	$ 105,226
Earnings (loss) per share:
Basic - as reported	$ 1.65	$ (7.75)	$ 1.99
Basic pro forma	$ 1.65	$ (7.75)	$ 1.98
Diluted - as reported	$ 1.65	$ (7.74)	$ 1.98
Diluted pro forma	$ 1.65	$ (7.74)	$ 1.98

USE OF ESTIMATES: The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

NEW ACCOUNTING PRONOUNCEMENTS: In June 2001, the Financial Accounting Standards Board (FASB) issued SFAS No. 143, Accounting for Asset Retirement Obligations. SFAS No. 143 establishes accounting standards for the recognition and measurement of an asset retirement obligation and its associated asset retirement cost. It also provides accounting guidance for legal obligations associated with the retirement of tangible long-lived assets. The Companys adoption of SFAS No. 143 in fiscal 2003 did not have a material impact on its financial position or results of operations.

In August 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or Disposal of Long Lived Assets. Consistent with prior guidance SFAS No. 144 continues to require a three-step approach for recognizing and measuring the impairment of assets to be held and used. Assets to be sold must be stated at the lower of the assets carrying amount or fair value, and depreciation is no longer recognized. The Companys adoption of SFAS No. 144 in fiscal 2003 did not have a material impact on its financial position or results of operations.

In April 2002, the FASB issued SFAS No. 145, Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections as of April 2002. With the rescission of SFAS No. 4, gains and losses from the extinguishment of debt should be classified as extraordinary items only if they meet the criteria in APB Opinion No. 30. Applying the provisions of APB Opinion No. 30 will distinguish transactions that are part of an entitys recurring operations from those that are unusual or infrequent or that meet the criteria for classification as an extraordinary item. SFAS No. 145 amends SFAS No. 13 to require that certain lease modifications that have economic effects similar to sale-leaseback transactions be accounted for in the same manner as sale-leaseback transactions. This amendment is consistent with the FASBs goal of requiring similar accounting treatment for transactions that have similar economic effects. SFAS No. 145 also makes technical corrections to existing pronouncements. While those corrections are not substantive in nature, in some instances they may change accounting practice. The Companys adoption of SFAS No. 145 in fiscal 2003 did not have a material impact on its financial position or results of operations.

In July 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated with Exit or Disposal Activities. SFAS No. 146 replaces current accounting literature and requires the recognition of costs associated with exit or disposal activities when they are incurred, rather than at the date of a commitment to an exit or disposal plan. SFAS No. 146 is to be applied prospectively to exit or disposal activities initiated after December 31, 2002. The Companys adoption of SFAS No. 146 in fiscal 2003 did not have a material impact on its financial position or results of operations.

In November 2002, the FASB issued FASB Interpretation No. 45, Guarantors Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others. This interpretation elaborates on the disclosures to be made by a guarantor in its interim and annual financial statements about its obligations under certain guarantees that it has issued. It also clarifies that a guarantor is required to recognize, at the inception of a guarantee entered into or modified after December 31, 2002, a liability for the fair value of the obligation undertaken in issuing the guarantee. The Company has applied the disclosure provisions of this interpretation in these consolidated financial statements and the accompanying notes. The Companys adoption of this interpretation in fiscal 2003 did not have a material impact on its financial position or results of operations.

In December 2002, the FASB issued SFAS No. 148, Accounting for Stock-Based Compensation Transition and Disclosure an amendment of FASB Statement No. 123. SFAS No. 148 amends SFAS No. 123, Accounting for Stock-Based Compensation, to provide alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. In addition, SFAS No. 148 amends the disclosure requirements of SFAS No. 123 to require prominent disclosures in both annual and interim financial statements about the method of accounting for stock-based employee compensation and the effect of the method used on reported results. The Company has applied the disclosure provisions in SFAS No. 148 in these consolidated financial statements.

In January 2003, the FASB issued FASB Interpretation No. 46, Consolidation of Variable Interest Entities. This interpretation of Accounting Research Bulletin No. 51, Consolidated Financial Statements, addresses consolidation by business enterprises of variable interest entities. Under current practice, two enterprises generally have been included in consolidated financial statements because one enterprise controls the other through voting interests. This interpretation defines the concept of variable interests and requires existing unconsolidated variable interest entities to be consolidated by their primary beneficiaries if the entities do not effectively disperse the risks among the parties involved. This interpretation applies to interests in variable interest entities or potential variable interest entities commonly referred to as special-purpose entities for periods ending after December 15, 2003 and for all other types of entities in financial statements for periods ending after March 15, 2004. If it is reasonably possible that an enterprise will initially consolidate or disclose information about a variable interest entity when this interpretation becomes effective, the enterprise shall disclose information about those entities in all financial statements issued after December 31, 2003. The Company is currently evaluating the impact, if any, of the adoption of this interpretation on its financial position and results of operations.

In April 2003, the FASB amended and clarified financial accounting and reporting for derivative instruments, including certain derivative instruments embedded in other contracts and hedging activities under SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities, through the issuance of SFAS No. 149, Amendment of Statement 133 on Derivative Instruments and Hedging Activities. SFAS No. 149 is effective for contracts entered into or modified after June 30, 2003 and for hedging relationships designated after June 30, 2003. The Companys adoption of SFAS No. 149 in fiscal 2003 did not have a material impact on its financial position or results of operations.

In May 2003, the FASB issued SFAS No. 150, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity. SFAS No. 150 modifies the accounting for certain financial instruments that, under previous guidance, issuers could account for as equity. SFAS No. 150 requires that those instruments be classified as liabilities in statements of financial position. The Companys adoption of SFAS No. 150 in fiscal 2003 did not have a material impact on its financial position or results of operations.

COMPARABILITY: For comparability, certain 2001 and 2002 amounts have been reclassified where appropriate to conform with the presentation adopted in 2003.

NOTE 2 - ACCOUNTING CHANGE

The Company adopted SFAS No. 142, Goodwill and Other Intangible Assets, in the first quarter of 2002. Based on an independent appraisal firms valuation of the reporting unit level fair value using discounted cash flows, which reflect changes in certain assumptions after the date of the acquisitions, and the identification of qualifying intangibles, the Company recorded a non-cash after tax charge of approximately $449.8 million as a cumulative effect of accounting change for the write-off of goodwill attributable to its continuing operations in the first quarter of 2002.

Raceway Associates which owns and operates Chicagoland Speedway and Route 66 Raceway and in which the Company holds a 37.5% indirect equity interest, also adopted SFAS No. 142 in the first quarter of 2002. During the second quarter of fiscal 2002, Raceway Associates completed the valuation of its Route 66 Raceway reporting unit using discounted cash flows, which reflect changes in certain assumptions since the date of Raceway Associates formation, that indicated impairment of the goodwill associated with Route 66 Raceway. The Companys proportionate share of Raceway Associates cumulative effect of accounting change related to the write-off of goodwill totaled approximately $3.4 million after-tax. In accordance with SFAS No. 3 Reporting Accounting Changes in Interim Financial Statements the Company recognized this impairment in the first quarter of 2002.

A reconciliation of net income (loss) and earnings (loss) per share, adjusted to exclude amortization expense, net of tax, for the period prior to adoption and the cumulative effect of accounting change recognized in the period of adoption, for the years ended November 30, is as follows (in thousands, except per share amounts):

	2001		2002		2003
Net income (loss)	$	87,633	$	(410,978)	$	105,448
Amortization from continuing operations, net of tax		14,985		-		-
Discontinued operations amortization, net of tax		987		-		-
Cumulative effect of accounting change		-		453,228		-
Discontinued operations cumulative effect of accounting
change		-		64,021		-
Adjusted net income	$	103,605	$	106,271	$	105,448
Basic:
Net income (loss) per share	$	1.65	$	(7.75)	$	1.99
Amortization from continuing operations		0.28		-		-
Discontinued operations amortization		0.02		-		-
Cumulative effect of accounting change		-		8.54		-
Discontinued operations cumulative effect of accounting
change		-		1.21		-
Adjusted net income per share	$	1.95	$	2.00	$	1.99
Diluted:
Net income (loss) per share	$	1.65	$	(7.74)	$	1.98
Amortization from continuing operations		0.28		-		-
Discontinued operations amortization		0.02		-		-
Cumulative effect of accounting change		-		8.54		-
Discontinued operations cumulative effect of accounting
change		-		1.20		-
Adjusted net income per share	$	1.95	$	2.00	$	1.98

NOTE 3 - EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share for the years ended November 30, (in thousands, except per share amounts):

	2001		2002		2003
Basic and diluted earnings (loss) per share numerator:
Income from continuing operations before cumulative
effect of accounting change	$	85,333	$	101,982	$	100,412
Income (loss) from discontinued operations, net of tax		2,300		(59,732)		5,036
Cumulative effect of accounting change		-		(453,228)		-
Net income (loss)	$	87,633	$	(410,978)	$	105,448
Basic earnings per share denominator:
Weighted average shares outstanding		52,996,660		53,036,552		53,057,077
Basic earnings per share:
Income from continuing operations before cumulative
effect of accounting change	$	1.61	$	1.92	$	1.89
Income (loss) from discontinued operations		0.04		(1.13)		0.10
Cumulative effect of accounting change		-		(8.54)		-
Net income (loss)	$	1.65	$	(7.75)	$	1.99
Diluted earnings per share denominator:
Weighted average shares outstanding		52,996,660		53,036,552		53,057,077
Common stock options		116		1,763		1,650
Contingently issuable shares		80,052		63,220		74,555
Diluted weighted average shares outstanding		53,076,828		53,101,535		53,133,282
Diluted earnings per share:
Income from continuing operations before cumulative
effect of accounting change	$	1.61	$	1.92	$	1.89
Income (loss) from discontinued operations		0.04		(1.12)		0.09
Cumulative effect of accounting change		-		(8.54)		-
Net income (loss)	$	1.65	$	(7.74)	$	1.98

During the years ended November 30, 2001, 2002 and 2003 there were approximately 18,160, 36,534 and 52,082 shares, respectively, that could potentially dilute future earnings per share that were not included in the computation of diluted earnings per share because to do so would have been anti-dilutive.

NOTE 4 - PROPERTY AND EQUIPMENT

Property and equipment consists of the following as of November 30 (in thousands):

	2002	2003
Land and leasehold improvements	$ 210,825	$ 230,773
Buildings, grandstands and tracks	731,415	766,353
Furniture and equipment	90,731	103,120
Construction in progress	18,558	20,049
	1,051,529	1,120,295
Less accumulated depreciation	192,433	235,672
	$ 859,096	$ 884,623

Depreciation expense from continuing operations was approximately $34.1 million, $39.1 million and $42.1 million for the years ended November 30, 2001, 2002 and 2003, respectively.

NOTE 5 - GOODWILL AND INTANGIBLE ASSETS

The gross carrying value and accumulated amortization of the major classes of intangible assets relating to the Motorsports Events segment as of November 30 are as follows (in thousands):

	2002
	Gross Carrying Amount	Accumulated Amortization
Amortized intangible assets:
Food, beverage and merchandise contracts	$ 35	$ 8
Total amortized intangible assets	$ 35	$ 8
Non-amortized intangible assets:
Water rights	$ 535
Liquor licenses	153
Total non-amortized intangible assets	$ 688
	2003
	Gross Carrying Amount	Accumulated Amortization
Amortized intangible assets:
Food, beverage and merchandise contracts	$ 276	$ 44
Total amortized intangible assets	$ 276	$ 44
Non-amortized intangible assets:
Water rights	$ 535
Liquor licenses	266
Total non-amortized intangible assets	$ 801

The following table presents current and expected amortization expense of the existing intangible assets as of November 30, for each of the following periods (in thousands):

Aggregate amortization expense:
For the year ended November 30, 2003	$ 36
Estimated amortization expense for
the year ending November 30:
2004	45
2005	44
2006	38
2007	38
2008	38

There were no changes in the carrying amount of goodwill for the year ended November 30, 2003.

NOTE 6 - ACQUISITIONS

On October 1, 2001, the Company acquired the remaining 10% interest it did not already own in Homestead-Miami Speedway (Miami) for $3.9 million. As predetermined in the July 1997 Purchase Agreement when the Company acquired its initial 40% interest in Miami, the purchase price was based on 10% of the negotiated facility valuation as of July 1997, plus interest. The acquisition was accounted for under the purchase method of accounting.

NOTE 7 - LONG-TERM DEBT

Long-term debt consists of the following as of November 30 (in thousands):

	2002	2003
Senior Notes, including premiums of $2,626 and $1,226,
respectively	$ 227,626	$ 226,226
Senior Notes, interest rate swap	-	(153)
TIF bond debt service funding commitment, net of discount
of $1,405 and $1,327, respectively	68,755	68,558
Term Loan	19,000	13,500
	315,381	308,131
Less: current portion	5,775	232,963
	$ 309,606	$ 75,168

Schedule of Payments
For the year ending November 30:
2004	$ 231,890
2005	7,505
2006	635
2007	770
2008	915
Thereafter	66,670
	308,385
Net discount	(101)
Senior Notes, interest rate swap	(153)
Total	$ 308,131

	2001	2002		2003
Current tax expense:
Federal	$ 30,204		$ 27,691	$ 22,669
State	3,761		7,519	4,081
Deferred tax expense (benefit):
Federal	23,395		29,288	36,065
State	3,243		(274)	2,125
Provision for income taxes	$ 60,603		$ 64,224	$ 64,940

	2001	2002	2003
Income tax computed at federal statutory rates	35.0%	35.0%	35.0%
State income taxes, net of federal tax benefit	3.2	3.5	3.1
Nondeductible goodwill	2.7	-	-
Other, net	0.6	0.1	1.2
	41.5%	38.6%	39.3%

	2002	2003
Amortization and depreciation	$ 48,138	$ 38,527
Deferred revenues	4,412	4,315
Loss carryforwards	2,672	2,840
Deferred expenses	2,645	2,454
Accruals	987	2,062
Compensation related	1,373	1,505
Other	275	199
Deferred tax assets	60,502	51,902
Amortization and depreciation	(130,916)	(157,664)
Equity investment	(4,210)	(7,322)
Other	(319)	(330)
Deferred tax liabilities	(135,445)	(165,316)
Net deferred tax liabilities	$ (74,943)	$ (113,414)

In October 2002, the Unified Government issued additional subordinate sales tax special obligation revenue bonds (2002 STAR Bonds) totaling approximately $6.3 million to reimburse the Company for certain construction already completed on the second phase of the Kansas Speedway project and to fund certain additional construction. The 2002 STAR Bonds will be retired with state and local taxes generated within the speedways boundaries and are not the Companys obligation. KSC has agreed to guarantee the payment of principal, any required premium and interest on the 2002 STAR Bonds. At November 30, 2003, the Unified Government had $6.3 million outstanding on 2002 STAR Bonds. Under a keepwell agreement, the Company has agreed to provide financial assistance to KSC, if necessary, to support KSCs guarantee of the 2002 STAR Bonds.

	Track
	Operating	Operating
For the year ending November 30:	Agreement	Leases
2004	$ 2,220	$ 2,599
2005	2,220	2,005
2006	2,220	1,015
2007	2,220	609
2008	2,220	523
Thereafter	33,660	3,266
Total	$ 44,760	$ 10,017

All of the racing events that take place during the Company's fiscal year are sanctioned by various racing organizations such as the American Historic Racing Motorcycle Association ("AHRMA"), the American Motorcyclist Association ("AMA"), the Automobile Racing Club of America ("ARCA"), the Championship Cup Series ("CCS"), the Federation Internationale de l'Automobile ("FIA"), the Federation Internationale Motocycliste ("FIM"), Grand American, Historic Sportscar Racing ("HSR"), the International Race of Champions ("IROC"), IRL, NASCAR, the Sports Car Club of America ("SCCA"), the Sportscar Vintage Racing Association ("SVRA"), the United States Auto Club ("USAC") and the World Karting Association ("WKA"). NASCAR, which sanctions some of the Company's principal racing events, is a member of the France Family Group which controls in excess of 60% of the combined voting power of the outstanding stock of the Company and some members of which serve as directors and officers. Standard NASCAR sanction agreements require racetrack operators to pay sanction fees and prize and point fund monies for each sanctioned event conducted. The prize and point fund monies are distributed by NASCAR to participants in the events. Prize and point fund monies paid by the Company to NASCAR from continuing operations for disbursement to competitors totaled approximately $68.6 million, $75.9 million and $83.9 million for the years ended November 30, 2001, 2002 and 2003, respectively. Prize and point fund monies paid by the Company to NASCAR for disbursement to competitors for events at North Carolina Speedway (North Carolina) included in discontinued operations totaled approximately $6.7 million, $7.4 million and $8.3 million for the fiscal years ended November 30, 2001, 2002 and 2003, respectively.

Since 2001, NASCAR has contracted directly with certain network providers for television rights to the entire NASCAR Winston Cup and NASCAR Busch series schedules. NASCAR Winston Cup and NASCAR Busch series event promoters share in the television rights fees in accordance with the provision of the sanction agreement for each NASCAR Winston Cup and NASCAR Busch series event. Under the terms of this arrangement, NASCAR retains 10% of the gross broadcast rights fees allocated to each NASCAR Winston Cup or NASCAR Busch series event as a component of its sanction fees and remits the remaining 90% to the event promoter. The event promoter pays 25% of the gross broadcast rights fees allocated to the event as part of the previously discussed prize money paid to NASCAR for disbursement to competitors. The Companys television broadcast and ancillary rights fees from continuing operations received from NASCAR for the NASCAR Winston Cup and NASCAR Busch series events conducted at its majority-owned facilities were $106.2 million, $122.0 million and $142.5 million in fiscal years 2001, 2002 and 2003, respectively. Television broadcast and ancillary rights fees received from NASCAR for the NASCAR Winston Cup and NASCAR Busch series events held at North Carolina and included in discontinued operations were $10.7 million, $12.3 million and $14.4 million in fiscal years 2001, 2002 and 2003, respectively.

In addition, NASCAR and the Company share a variety of expenses in the ordinary course of business. NASCAR pays rent, as well as a related maintenance fee (allocated based on square footage), to the Company for office space in the Companys corporate office complex in Daytona Beach, Florida. The Company paid rent to NASCAR for office space in Charlotte, North Carolina and New York, New York through mid-fiscal 2002. These rents are based upon estimated fair market lease rates for comparable facilities. NASCAR pays the Company for various tickets and credentials, catering services, suites, participation in a NASCAR racing event banquet, exhibit and display space, track and other equipment rentals based on similar prices paid by unrelated, third party purchasers of similar items. The Company pays NASCAR for certain advertising, participation in NASCAR racing series banquets and the use of NASCAR trademarks based on similar prices paid by unrelated, third party purchasers of similar items. NASCAR also reimburses the Company for 50% of the compensation paid to certain personnel working in the Companys legal, risk management and transportation departments, as well as 50% of the compensation expense associated with receptionists. The Company reimburses NASCAR for 50% of the compensation paid to one of the personnel working in NASCARs legal department. The Companys payments to NASCAR for MRN Radios broadcast rights to NASCAR Craftsman Truck races represents an agreed-upon percentage of the Companys advertising revenues attributable to such race broadcasts. NASCARs reimbursement for use of the Companys telephone system, mailroom, janitorial services, catering, graphic arts, photo and publishing services, and the Companys reimbursement of NASCAR for use of corporate aircraft, is based on actual usage or an allocation of total actual usage. The aggregate amount received from NASCAR by the Company for shared expenses, net of amounts paid by the Company for shared expenses, totaled approximately $1.5 million, $1.8 million and $2.4 million during fiscal 2001, 2002 and 2003, respectively.

In addition, Grand American and the Company share a variety of expenses in the ordinary course of business. Grand American pays rent to the Company for office space in the Companys corporate office complex in Daytona Beach, Florida. These rents are based upon estimated fair market lease rates for comparable facilities. Grand American purchases various sponsorship, catering services, hospitality and equipment rentals from the Company based on similar prices paid by unrelated, third party purchasers of similar items. The Company pays Grand American for the use of Grand Americans trademarks based on similar prices paid by unrelated, third party purchasers of similar items. Grand Americans reimbursement for use of the Companys telephone system, mailroom and janitorial, graphic arts, photo and publishing services is based on actual usage or an allocation of total actual usage. The aggregate amount received from Grand American by the Company for shared expenses, net of amounts paid by the Company for shared expenses, totaled approximately $168,000, $237,000 and $205,000 during fiscal 2001, 2002 and 2003, respectively.

The Company strives to ensure, and management believes that, the terms of the Companys transactions with NASCAR and Grand American are no less favorable to the Company than could be obtained in arms-length negotiations.White River Investment Limited Partnership and Western Opportunity Limited Partnership, both members of the France Family Group, were among the selling shareholders in the Companys secondary offering of Class A Common Stock, which closed in May 2003. In connection with that secondary offering all of the selling shareholders had agreed to fully reimburse the Company for all expenses in excess of approximately $75,000, which were associated with the offering. Following the closing of that secondary offering, in accordance with an allocation agreed among all the selling shareholders, and as a result of the reimbursement arrangement, the Company invoiced and White River Investment Limited Partnership and Western Opportunity Limited Partnership reimbursed the Company approximately $295,000 and $85,000, respectively, for expenses incurred by the Company as a result of that secondary offering. In addition, during fiscal 2003, certain members of the France Family Group paid the Company for the utilization of security services, purchase of catering services, event tickets and certain equipment and the Company purchased a vehicle from a France Family Group member. The amounts paid for these items were based on actual costs incurred, similar prices paid by unrelated third party purchasers of similar items or estimated fair market values. The aggregate amount received by the Company for these items, net of amounts paid by the Company for the vehicle, totaled approximately $77,000.

The Company has collateral assignment split‑dollar insurance agreements covering the lives of William C. France and James C. France and their respective spouses. Pursuant to the agreements, the Company advanced the annual premiums of approximately $1.2 million each year for a period of eight years which ended in fiscal 2002. Upon surrender of the policies or payment of the death benefits thereunder, the Company is entitled to repayment of an amount equal to the cumulative premiums previously paid by the Company. The Company may cause the agreements to be terminated and the policies surrendered at any time after the cash surrender value of the policies equals the cumulative premiums advanced under the agreements. The Company recorded the insurance expense net of the increase in cash surrender value of the policies associated with these agreements.

J. Hyatt Brown, one of the Companys directors, serves as President and Chief Executive Officer of Brown & Brown, Inc. (Brown). Brown has received commissions for serving as the Companys insurance broker for several of the Companys insurance policies, including the Companys property and casualty policy, certain employee benefit programs and the split-dollar arrangements established for the benefit of William C. France, James C. France and their respective spouses. The aggregate commissions received by Brown in connection with the Companys policies were approximately $549,000, $475,000 and $443,000, during fiscal 2001, 2002 and 2003, respectively.

Pursuant to the merger agreement for the PMI acquisition, the Company originally was obligated to place up to three individuals designated by Penske Performance, Inc., on its board of directors and to include such designees as nominees recommended by the Companys Board of Directors at future elections of directors by shareholders, based upon the amount of Company stock held by Penske Performance, Inc. As the holdings of Penske Performance, Inc. have fallen to less than 2% percent of the aggregate shares of the Companys outstanding Class A and Class B Common Stock, the Company is no longer obligated to include any individuals designated by Penske Performance, Inc. as nominees for the Companys board of directors. Until April 2003 Messrs. Roger S. Penske, Gregory W. Penske and Walter P. Czarnecki were the designees of Penske Performance, Inc. serving on the Companys Board of Directors. Mr. Gregory W. Penske remains on the Companys Board of Directors. Penske Performance, Inc. is a wholly-owned by Penske Corporation. Messrs. Roger S. Penske and Czarnecki were also officers and directors of Penske Performance, Inc. and other Penske Corporation affiliates. Mr. Gregory W. Penske is also an officer and director of Penske Performance, Inc. and other Penske Corporation affiliates, as well as the son of Roger S. Penske. Roger S. Penske beneficially owns a majority of the voting stock of and controls Penske Corporation and its affiliates. During fiscal 2001, Penske Corporation provided the Company with certain executive and legal services at a cost of approximately $496,000, paid in both cash and stock. The Company rented Penske Corporation and its affiliates certain facilities for a driving school and sold admissions to the Companys events, hospitality suite occupancy and related services, merchandise and accessories to Penske Corporation, its affiliates and other related companies. Also, Penske Truck Leasing rented certain vehicles and sold related supplies and services to the Company. In fiscal 2001, 2002 and 2003, the aggregate amount received from Penske Corporation, its affiliates and other related companies, net of amounts paid by the Company, totaled approximately $2.6 million, $1.2 million and $887,000, respectively, for the aforementioned goods and services.

	2001	2002	2003
Income taxes paid	$ 31,942	$ 32,290	$ 26,070
Interest paid	$ 32,032	$ 25,146	$ 23,796

	2001	2002	2003
Expected life (years)	5	5	5
Dividend yield	0.15%	0.14%	0.15%
Expected volatility	35.9%	34.4%	31.9%
Risk-free interest rate	4.7%	4.6%	2.9%
Weighted average fair value of options
Granted	$ 15.21	$ 16.51	$ 13.02

	Weighted Average Exercise Price	Number of Shares
Outstanding at November 30, 2000	$ 44.50	11,030
Granted	39.34	35,165
Outstanding at November 30, 2001	40.58	46,195
Granted	43.94	25,224
Forfeited	37.06	(2,000)
Outstanding at November 30, 2002	41.90	69,419
Granted	39.89	12,929
Outstanding at November 30, 2003	41.58	82,348
Exercisable at:
November 30, 2001	$ 41.38	19,022
November 30, 2002	41.65	41,176
November 30, 2003	41.81	65,077

	Outstanding				Exercisable
Exercise Price Range	Options	Weighted Average Remaining Contractual Life (in years)		Weighted Average Exercise Price	Options		Weighted Average Exercise Price
$37.06-$44.73	82,348	7.9	$	41.58	65,077	$	41.81

	Fiscal Quarter Ended
	February 28,	May 31,	August 31,	November 30,
	2002 (1)	2002	2002	2002
Total revenue	$ 114,599	$ 116,675	$ 136,324	$ 160,159
Operating income	44,906	31,651	50,163	60,667
Income from continuing operations	22,900	14,865	30,116	34,101
Net (loss) income	(491,886)	14,370	29,555	36,983
Basic (loss) earnings per share	(9.27)	0.27	0.56	0.70
Diluted (loss) earnings per share	(9.26)	0.27	0.56	0.70

	Fiscal Quarter Ended
	February 28,	May 31,	August 31,	November 30,
	2003	2003	2003	2003
Total revenue	$ 119,875	$ 119,590	$ 160,540	$ 152,065
Operating income	44,982	28,247	59,909	51,049
Income from continuing operations	22,798	12,769	36,500	28,345
Net income	25,364	12,492	35,953	31,639
Basic earnings per share	0.48	0.24	0.68	0.60
Diluted earnings per share	0.48	0.24	0.68	0.60

(1) Reflects the adoption of SFAS No. 142, which resulted in a non-cash after-tax charge of approximately $517.2 million in the first quarter of fiscal 2002. Included in this charge is approximately $64.0 million attributable to discontinued operations of North Carolina and approximately $3.4 million associated with the Companys equity investment in Raceway Associates.

	For The Year Ended November 30, 2001
	Motorsports Event	All Other	Total
Revenues	$ 479,107	$ 38,353	$ 517,460
Depreciation and amortization	45,705	4,974	50,679
Operating income	155,991	9,104	165,095
Capital expenditures	87,729	10,650	98,379
Total assets	1,593,074	109,072	1,702,146
Equity investments	32,667	-	32,667

	For The Year Ended November 30, 2002
	Motorsports Event	All Other	Total
Revenues	$ 498,387	$ 38,538	$ 536,925
Depreciation and amortization	34,024	5,133	39,157
Operating income	177,388	9,999	187,387
Capital expenditures	45,752	7,769	53,521
Total assets	1,036,611	119,360	1,155,971
Equity investments	31,152	-	31,152

	For The Year Ended November 30, 2003
	Motorsports Event	All Other	Total
Revenues	$ 523,456	$ 39,058	$ 562,514
Depreciation and amortization	36,545	5,590	42,135
Operating income	174,466	9,721	184,187
Capital expenditures	67,957	4,630	72,587
Total assets	1,106,644	197,148	1,303,792
Equity investments	33,706	-	33,706

As a result of the adoption of SFAS No. 142, the Motorsports Event segment recorded a non-cash after-tax charge of $453.2 million as a cumulative effect of accounting change for the write-off of goodwill in the first quarter of fiscal 2002.

NOTE 19 DISCONTINUED OPERATIONS

Through the Company's participation in court ordered mediation related to the Ferko/Vaughn litigation (NOTE 10) the terms of a settlement agreement (Settlement Agreement) were reached in April 2004. Upon the satisfaction of certain preconditions to the Settlement Agreement becoming effective it was filed with the court in May 2004. Pursuant to the terms of the Settlement Agreement, the Company's North Carolina Speedway, Inc. subsidiary sold North Carolina's tangible and intangible assets and operations to a subsidiary of SMI for $100.4 million. The sale of North Carolina's assets closed on July 1, 2004. The Settlement Agreement which was approved by the Court on July 1, 2004, releases ISC and NASCAR from all claims related to the litigation. The released claims include, but are not limited to, allegations or assertions with respect to the awarding and/or sanctioning of races, the effect of the common control of NASCAR and ISC residing in the France Family Group, and the market power either individually or jointly of NASCAR and ISC.

Description	Balance beginning of period	Additions charged to costs and expenses	Deductions (A)	Balance at end of period
For the year ended November 30, 2003
Allowance for doubtful accounts	$ 1,500	$ 2,609	$ 2,609	$ 1,500
For the year ended November 30, 2002
Allowance for doubtful accounts	1,500	248	248	1,500
For the year ended November 30, 2001
Allowance for doubtful accounts	1,200	3,500	3,200	1,500