Duke Energy 2012 Annual Report Download - page 102

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PART II
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders of
Progress Energy, Inc.
Charlotte, North Carolina
We have audited the accompanying consolidated balance sheets of Progress Energy, Inc. and subsidiaries (the “Company”) as of December 31, 2012 and 2011, and the related
consolidated statements of operations and comprehensive income, common stockholders’ equity, and cash fl ows for each of the three years in the period ended December 31,
2012. We also have audited the Company’s internal control over fi nancial reporting as of December 31, 2012, based on criteria established in Internal Control —
Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Company’s management is responsible for these 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, included in
the accompanying Management’s Annual Report On Internal Control Over Financial Reporting. Our responsibility is to express an opinion on these fi nancial statements and an
opinion on the Company’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 audit to obtain reasonable assurance about whether the fi nancial statements are free of material misstatement and whether effective internal control
over fi nancial reporting was maintained in all material respects. Our audits of the fi nancial statements included examining, on a test basis, evidence supporting the
amounts and disclosures in the fi nancial statements, assessing the accounting principles used and signifi cant estimates made by management, and evaluating the
overall fi nancial statement 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 weakness exists, 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 process designed by, or under the supervision of, the company’s principal executive and principal fi nancial
offi cers, or persons performing similar functions, and effected by the company’s board of directors, management, and other personnel 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 reasonable 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 expenditures 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 the inherent limitations of internal control over fi nancial reporting, including the possibility of collusion or improper management override of controls,
material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the
internal control over fi nancial reporting to future periods are subject to the risk that the controls may become inadequate 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 referred to above present fairly, in all material respects, the fi nancial position of Progress Energy, Inc. and
subsidiaries as of December 31, 2012 and 2011, and the results of their operations and their cash fl ows for each of the three years in the period ended December 31,
2012, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the Company maintained, in all material
respects, effective internal control over fi nancial reporting as of December 31, 2012, based on the criteria established in Internal Control — Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission.
/s/ Deloitte & Touche LLP
Charlotte, North Carolina
February 28, 2013