GE 2011 Annual Report Download - page 35

GE 2011 ANNUAL REPORT 33
Report of Independent Registered
Public Accounting Firm
To Shareowners and Board of Directors
of General Electric Company:
We have audited the accompanying statement of fi nancial
position of General Electric Company and consolidated affi liates
(“GE”) as of December 31, 2011 and 2010, and the related state-
ments of earnings, changes in shareowners’ equity and cash
fl ows for each of the years in the three-year period ended
December 31, 2011. We also have audited GE’s internal control
over fi nancial reporting as of December 31, 2011, based on
criteria established in Internal Control—Integrated Framework
issued by the Committee of Sponsoring Organizations of the
Treadway Commission (“COSO”). GE management is responsible
for these consolidated fi nancial statements, for maintaining
effective internal control over fi nancial reporting, and for its
assessment of the effectiveness of internal control over fi nancial
reporting. Our responsibility is to express an opinion on these
consolidated fi nancial statements and an opinion on GE’s internal
control over fi nancial reporting 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 audits to
obtain reasonable assurance about whether the fi nancial state-
ments are free of material misstatement and whether effective
internal control over fi nancial reporting was maintained in all
material respects. Our audits of the consolidated fi nancial state-
ments included examining, on a test basis, evidence supporting
the amounts and disclosures in the fi nancial statements, assess-
ing the accounting principles used and signifi cant estimates
made by management, and evaluating the overall fi nancial state-
ment presentation. Our audit of internal control over fi nancial
reporting included obtaining an understanding of internal control
over fi nancial reporting, assessing the risk that a material weak-
ness exists, and testing and evaluating the design and operating
effectiveness of internal control based on the assessed risk. Our
audits also included performing such other procedures as we
considered necessary in the circumstances. We believe that our
audits provide a reasonable basis for our opinions.
A company’s internal control over fi nancial reporting is a pro-
cess designed to provide reasonable assurance regarding the
reliability of fi nancial reporting and the preparation of fi nancial
statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control
over fi nancial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reason-
able detail, accurately and fairly refl ect the transactions and
dispositions of the assets of the company; (2) provide reasonable
assurance that transactions are recorded as necessary to permit
preparation of fi nancial statements in accordance with generally
accepted accounting principles, and that receipts and expendi-
tures of the company are being made only in accordance with
authorizations of management and directors of the company;
and (3) provide reasonable assurance regarding prevention or
timely detection of unauthorized acquisition, use, or disposition
of the company’s assets that could have a material effect on the
fi nancial statements.
Because of its inherent limitations, internal control over
fi nancial reporting may not prevent or detect misstatements.
Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become inad-
equate because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.
In our opinion, the consolidated fi nancial statements appear-
ing on pages 70, 72, 74, 76–136 and the Summary of Operating
Segments table on page 42 present fairly, in all material
respects, the fi nancial position of GE as of December 31, 2011
and 2010, and the results of its operations and its cash fl ows for
each of the years in the three-year period ended December 31,
2011, in conformity with U.S. generally accepted accounting
principles. Also, in our opinion, GE maintained, in all material
respects, effective internal control over fi nancial reporting as
of December 31, 2011, based on criteria established in Internal
Control—Integrated Framework issued by COSO.
As discussed in Note 1 to the consolidated fi nancial state-
ments, GE, in 2010, changed its method of accounting for
consolidation of variable interest entities; and, in 2009, changed
its method of accounting for impairment of debt securities, busi-
ness combinations and noncontrolling interests.
Our audits of GE’s consolidated fi nancial statements were
made for the purpose of forming an opinion on the consoli-
dated fi nancial statements taken as a whole. The accompanying
consolidating information appearing on pages 71, 73 and 75
is presented for purposes of additional analysis of the consoli-
dated fi nancial statements rather than to present the fi nancial
position, results of operations and cash fl ows of the individual
entities. The consolidating information has been subjected to
the auditing procedures applied in the audits of the consoli-
dated fi nancial statements and, in our opinion, is fairly stated
in all material respects in relation to the consolidated fi nancial
statements taken as a whole.
KPMG LLP
Stamford, Connecticut
February 24, 2012