Business

Our Performance

Governing Well

Implementing Sarbanes-Oxley

In response to a number of major corporate and accounting scandals, the United States Government passed the Sarbanes-Oxley Act of 2002 (SOX). Section 404 of the Act requires company management to establish and assess internal controls over financial reporting on an on-going basis. As a company registered with the Security Exchange Commission (SEC), TransCanada must comply with SOX.

We have had a Sarbanes-Oxley Implementation Team (SOXIT) in place since 2003. The team’s goal is to encourage transparency in our financial reporting. It achieves that through extensive review, testing and remediation of all internal processes involved in financial reporting. In addition, we created the SOX Remediation and Compliance Project to ensure strict controls around all of our information systems.

Our internal review was completed in 2006. The external auditors reviewed our process informally. A formal audit was conducted under Section 404 of the Sarbanes-Oxley Act, resulting in a satisfactory report.

The work of the SOXIT team complements existing TransCanada policies regarding conduct, including:

• codes of business ethics;
• authorities and spending limits;
• public disclosure;
• information management and security;
• trading policy for employees and insiders;
• business expense;
• business travel;
• communications;
• government relations; and
• political contributions

Code of Business Ethics

TransCanada’s Code of Business Ethics policy sets out standards of business integrity that govern our relationships with customers, shareholders, communities and others in our workplace. Any TransCanada employee who suspects unethical behaviour may make an anonymous report through EthicsPoint, Inc., a secure, confidential, anonymous third-party reporting system. There were 63 calls to the Ethics Help-Line in 2006, and all were resolved by TransCanada’s Internal Audit Department.