Atmos Energy 1998 Annual Report Download - page 46

MANAGEMENT’SRESPONSIBILITY FOR FINANCIAL STATEMENTS
Management is responsible for the preparation, presentation
and integrity of the financial statements and other financial infor-
mation in this report. The accompanying financial statements
have been prepared in accordance with generally accepted
accounting principles, and include estimates and judgments made
by management that were necessary to prepare the statements in
accordance with such accounting principles.
The Company maintains a system of internal accounting con-
trols designed to provide reasonable assurance that assets are safe-
guarded from loss and that transactions are executed and recorded
in accordance with established procedures. The concept of reason-
able assurance is based on the recognition that the cost of main-
taining a system of internal accounting controls should not exceed
related benefits. The system of internal accounting controls is sup-
ported by written policies and guidelines, internal auditing and the
careful selection and training of qualified personnel.
The financial statements have been audited by the Company’s
independent auditors. Their audit was made in accordance with
generally accepted auditing standards, as indicated in the Report
of Independent Auditors, and included a review of the system of
internal accounting controls and tests of transactions to the
extent they considered necessary to carry out their responsibilities
for the audit.
Management has considered the internal auditors’ and the
independent auditors’ recommendations concerning the
Company’s system of internal control and has taken actions that
are believed to be cost-effective in the circumstances to respond
appropriately to these recommendations. The Audit Committee of
the Board of Directors meets periodically with the internal audi-
tors and the independent auditors to discuss the Company’s inter-
nal accounting controls, auditing and financial reporting matters.
REPORT OF ERNST &YOUNG LLP, INDEPENDENT AUDITORS
Board of Directors
Atmos Energy Corporation
We have audited the accompanying consolidated balance
sheets of Atmos Energy Corporation at September 30,1998 and
1997, and the related consolidated statements of income, share-
holders’ equity and cash flows for each of the three years in the
period ended September 30,1998. These financial statements are
the responsibility of the Company’s management. Our responsi-
bility is to express an opinion on these financial statements based
on our audits. We did not audit the financial statements of United
Cities Gas Company, wholly owned by Atmos Energy
Corporation (see Note 2), which statements reflect total revenues
of $402,947,000 for the year ended December 31,1996. Those
statements were audited by other auditors whose report has been
furnished to us and our opinion, insofar as it relates to data
included for United Cities Gas Company is based solely on the
report of the other auditors.
We conducted our audits in accordance with generally accept-
ed auditing standards. 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 and the
report of other auditors provide a reasonable basis for our opinion.
In our opinion, based on our audits and the report of other
auditors, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of
Atmos Energy Corporation at September 30,1998 and 1997, and
its consolidated results of operations and its cash flows for each of
the three years in the period ended September 30,1998 in con-
formity with generally accepted accounting principles.
Dallas, Texas
November 10,1998
42 ATMOS ENERGY CORPORATION