Energy Transfer 2012 Annual Report Download - page 116

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For financial instruments, failure of a counterparty to perform on a contract could result in our inability to realize amounts that
have been recorded on our consolidated balance sheet and recognized in net income or other comprehensive income.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The financial statements starting on page F-1 of this report are incorporated by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
An evaluation was performed under the supervision and with the participation of our management, including the Chief Executive
Officer and Chief Financial Officer of our General Partner, of the effectiveness of the design and operation of our disclosure
controls and procedures (as such terms are defined in Rules 13a–15(e) and 15d–15(e) of the Exchange Act) as of the end of the
period covered by this report. Based upon that evaluation, management, including the Chief Executive Officer and Chief Financial
Officer of our General Partner, concluded that our disclosure controls and procedures were adequate and effective as of
December 31, 2012.
Management’s Report on Internal Control over Financial Reporting
The management of Energy Transfer Partners, L.P. and subsidiaries is responsible for establishing and maintaining adequate
internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with
the participation of our management, including the Chief Executive Officer and Chief Financial Officer of our General Partner,
we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal
Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO
framework”).
On October 5, 2012, Sam Acquisition Corporation, a Pennsylvania corporation and a wholly-owned subsidiary of ETP, completed
its merger with Sunoco, Inc. ("Sunoco"). Immediately following the closing of the Sunoco Merger, ETE contributed its interest
in Southern Union into ETP Holdco Corporation (“Holdco”), an ETP-controlled entity. Management has acknowledged that it is
responsible for establishing and maintaining a system of internal controls over financial reporting for Sunoco. We are in the process
of integrating Sunoco, and we therefore excluded Sunoco from our December 31, 2012 assessment of the effectiveness of internal
control over financial reporting. Sunoco had total assets of $4.51 billion at December 31, 2012 and third party revenue of $5.93
billion from October 5, 2012 to December 31, 2012 included in our consolidated financial statements as of and for the year ended
December 31, 2012. The impact of the Sunoco transaction has not materially affected and is not expected to materially affect our
internal control over financial reporting. As a result of these integration activities, certain controls will be evaluated and may be
changed. We believe, however, that we will be able to maintain sufficient controls over the substantive results of our financial
reporting throughout this integration process.
Our assessment of internal control over financial reporting did include assessments of Sunoco Logistics and Southern Union, both
of which ETP obtained control of in connection with the Sunoco Merger and Holdco Transaction.
Based on our evaluation under the COSO framework, our management concluded that our internal control over financial reporting
was effective as of December 31, 2012.
Grant Thornton LLP, an independent registered public accounting firm, has audited the effectiveness of our internal control over
financial reporting as of December 31, 2012, as stated in their report, which is included herein.
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