To the Board of Directors of the Tennessee Valley Authority:
We have audited, in accordance with auditing standards generally accepted in the United States of America and Government Auditing Standards issued by the Comptroller General of the United States, the balance sheets (power program and all programs) of the Tennessee Valley Authority as of Sept. 30, 2003 and 2002, and the related statements of income (power program), changes in proprietary capital (power program and nonpower programs), comprehensive income (power program), net expense and comprehensive loss (nonpower programs) and cash flows (power program and all programs) for each of the three years in the period ended Sept. 30, 2003 (not presented herein) appearing on pages 58 through 87 of the Tennessee Valley Authority Information Statement dated February 4, 2004; and in our report dated January 23, 2004, we expressed an unqualified opinion on those financial statements.
As discussed in note 1 to the financial statements, effective Oct. 1, 2002, TVA changed the methodology for estimating unbilled revenue from electricity sales. As discussed in note 1 to the financial statements, effective Oct. 1, 2002, TVA adopted Statement of Financial Accounting Standards No. 143, Accounting for Asset Retirement Obligations. As discussed in note 1 to the financial statements, effective Oct. 1, 2002, TVA adopted EITF No. 02-3, Issues Involved in Accounting for Derivative Contracts Held for Trading Purposes and Contracts Involved in Energy Trading and Risk Management Activities.
In accordance with Government Auditing Standards, we have also issued our report dated Jan. 23, 2004, on our consideration of the Tennessee Valley Authority’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws and regulations for the year ended Sept. 30, 2003. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit.
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PricewaterhouseCoopers LLP
Knoxville, Tenn.
January 23, 2004 |
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