Duke Energy

Consolidated Financial Statements

Notes to Consolidated Financial Statements

Note 1.
Summary of Significant Accounting Policies

Note 2.
Business Acquisitions and Dispositions

Note 3.
Business Segments

Note 4.
Regulatory Matters

Note 5.
Joint Ownership of Generating Facilities

Note 6.
Income Taxes

Note 7.
Risk Management Instruments, Hedging Activities and Credit Risk

Note 8.
Investment in Unconsolidated Affiliates and Related Party Transactions

Note 9.
Asset Impairments and Other Changes

Note 10.
Property, Plant and Equipment

Note 11.
Debt and Credit Facilities

Note 12.
Nuclear Decommissioning Costs

Note 13.
Guaranteed Preferred Beneficial Interests in Subordinated Notes of Duke Energy or Subsidiaries

Note 14.
Minority Interest

Note 15.
Preferred and Preference Stock at Duke Energy

Note 16.
Commitments and Contingencies

Note 17.
Guarantees and Indemnifications

Note 18.
Common Stock and Equity Offerings

Note 19.
Stock-Based Compensation

Note 20.
Employee Benefit Plans

Note 21.
Quarterly Financial Data (Unaudited)
   

Note 22.
Subsequent Events (Unaudited)

Schedule II – Valuation and Qualifying Accounts and Reserves

Independent Auditors’ Report

Responsibility for Financial Statements

22. Subsequent Events (Unaudited)

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In October 2002, Duke Energy entered into a $244 million stock purchase agreement with National Fuel Gas Company, including the assumption of approximately $58 million in debt, under which it would acquire Duke Energy’s wholly owned Empire State Pipeline. This natural gas pipeline, which originates at the U.S./ Canada border and extends into New York, was acquired by Duke Energy as part of the Westcoast acquisition in March 2002 (see Note 2). The sale to National Fuel Gas Company closed in February 2003.

In March 2003, Duke Energy announced that it will exit the merchant finance business at DCP in an orderly manner. Duke Energy expects the exit to generate positive cash flows in 2003 and 2004.

For information on subsequent events related to litigation and contingencies refer to Note 4, Franchised Electric section and Note 16, Litigation section. For information on subsequent events related to debt and other financing matters refer to Note 11.

©Copyright 2003

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