Financial Compliance Process

GE has adopted strict and demanding accounting policies and devotes its full resources to ensuring that those policies are applied properly and consistently throughout the world. We maintain a dynamic system of internal controls and procedures designed to ensure reliable financial record keeping, transparent reporting and disclosure, and protection of physical and intellectual property. Controllers in each GE business and at GE headquarters conduct regular balance sheet reviews and account reconciliations, and discuss issues and best practices at regular meetings of the GE Controllership Council.

The senior finance leadership team oversees the application of accounting policies and regularly discusses current controllership metrics, as well as new and upcoming accounting policies, during its Finance Council meetings.

The GE internal audit function includes about 620 auditors, including 400 members of the Corporate Audit Staff, and conducts primarily financial and compliance audits each year, in every geographic area, at every GE business. Our Audit Committee oversees the scope and evaluates the overall results of these audits, and members of that Committee regularly attend GE Capital Services Board of Directors, Corporate Audit Staff and Controllership Council meetings. The Corporate Audit Staff reports directly to the Audit Committee of the Board. In addition, more than 300 partners from KPMG LLP, GE’s independent auditor, work with their colleagues and the Corporate Audit Staff to conduct the necessary statutory and auditing reviews.

GE finance leaders, including the CFO, the global controller and the head of the Corporate Audit Staff, regularly review the status of controllership metrics (including account reconciliations, the outcomes of Corporate Audit Staff reviews and Sarbanes-Oxley 404 certification) with the Audit Committee.

Senior management of the businesses and the Company conducts regular reviews of the financial operations at each business. The CEOs and CFOs of GE businesses have been required to sign representation letters attesting to financial results for over 30 years, long before the Sarbanes-Oxley Act mandated such letters.

Executives with detailed knowledge of GE businesses — and the related needs of investors — serve on disclosure committees at both the business and corporate levels. These disclosure committees ensure the completeness of financial and nonfinancial disclosures and report their findings to the CEO, the CFO and the Audit Committee.