Our reputation as an honest business partner rests on the financial integrity of our books, records, and accounting procedures. CenterPoint Energy provides shareholders with full, accurate, timely, and understandable information about our financial condition and the results of our operations.
We maintain accurate and complete records of all financial and business transactions. You must never record or omit information to hide or alter the truth. You are responsible for following our system of internal controls.
Generally Accepted Accounting PrinciplesWe keep all financial records in accordance with Generally Accepted Accounting Principles. Our financial checks and balances help us properly account for revenue, expenses, assets, and liabilities. Any business information you create, transmit, or record at CenterPoint Energy must be accurate, complete, and timely. This includes costs, sales, time sheets, bills, payroll and benefits records, regulatory data, and other essential company information.
Officers and employees who are responsible for financial or accounting matters are required to ensure full, fair, accurate, and timely disclosure in all public communications and any periodic reports that CNP must file with the Securities and Exchange Commission. Our Disclosure Committee helps ensure that we comply fully with our reporting requirements.
Auditing and Accounting Concerns
CNP’s Audit Committee has adopted procedures for the receipt, retention, and treatment of complaints regarding accounting, internal controls, and auditing matters. You may submit a confidential or anonymous complaint about questionable accounting, internal controls, or auditing to our Corporate Compliance Officer. Submissions will be reviewed under Audit Committee direction and oversight by the Corporate Compliance Officer, General Counsel, Internal Audit, or other such persons as the Audit Committee determines to be appropriate. We will take prompt and appropriate corrective action. You may submit your concern in good faith, without fear of dismissal or retaliation of any kind. CNP will keep a record of all concerns about accounting, internal controls, and auditing, to track their receipt, investigation, and resolution.
Records Management and Records Requests
We have a records management system that determines what records we need to keep and for how long. It is your responsibility to know and follow the policies and procedures for managing the records in your area. If someone outside of CNP asks for records, contact the Legal Department. They will provide instructions on how to respond. Never destroy records that are related to ongoing litigation or an investigation.
Our Authorization Policy establishes which individuals by title can make financial commitments on behalf of CNP. Become familiar with your personal level of authority before you enter into a transaction, sign a contract, or approve an expenditure.
Remember these key points:
- Prepare all records – expense reports, time reports, and financial statements – accurately, honestly, and promptly. Never make a false or misleading entry.
- Bring to the attention of the Legal Department, Audit Services, Corporate Compliance Officer, or Chairman of the Audit Committee, any irregularity or inconsistency in our records and books.
- Never alter, remove, or destroy documents except in accordance with our policy.
- Never create any secret, undisclosed, or “off the books” record, fund, or account.
- Cooperate fully with our internal and external auditors.
QUESTION: I suspect that our quarterly financial statements are not completely accurate. It could be that there are legitimate differences in professional opinion. On the other hand, I am worried that sales might have been booked in one quarter, but were not really “signed, sealed, and delivered” until the next quarter. What should I do?
ANSWER: You must speak up and promptly discuss your concerns with a manager, the General Counsel, Audit Services, or the Corporate Compliance Officer. Do not delay. Let’s find out the facts behind the sale, and make sure that our books accurately reflect our business activity.
Fraud compromises the integrity of our financial reporting systems.It involves intentionally misrepresenting or concealing facts that would lead someone else to rely upon false information. Fraud can range from minor employee theft to significant misstatements of our earnings and holdings. Financial fraud can have an adverse effect on our company’s reputation and net worth.
Each employee must understand what constitutes fraud and follow all of our existing controls. Moreover, employees should report all suspicious financial activities.
It is wrong to:
- Inaccurately record your time or expenses
- Falsify quality, environmental, or safety reports
- Record false sales or expense reports
- Understate or overstate liabilities and assets
We believe our customers should choose our services because of their basic value, not because they received something inappropriate from us. You must never offer anything of value to obtain an improper advantage when conducting company business. We prohibit kickbacks, bribes, and payoffs.
It is just as wrong to offer a kickback as it is to accept a bribe. Never accept anything from a supplier in exchange for favorably considering their products or services.
All countries prohibit bribery of their public officials. Many countries, including the United States, also prohibit bribery of officials of other countries. You may not give any unauthorized payment, concession, or bribe to government officials, government employees, or private parties engaged in commercial transactions.
Remember these key points:
- Don’t make payments or give gifts that are intended to increase or improve the business that customers do with our company.
- Inappropriate or questionable payments made through an intermediary are just as unacceptable as those that are made directly.
On occasion, you may have information about CNP or a company with which we do business that is not known to the investing public. Such inside information may relate to: business plans, new services, mergers and acquisitions, stock sales, contract negotiations, major litigation, or financial information.
It is illegal to buy or sell any company’s stock based on insider information, or to pass this information on to – or “tip” – someone else who then buys or sells stock or options, until that information has been publicly disseminated. These rules apply to simple as well as complex transactions of securities and other financial instruments, and also when making allocations in retirement accounts. The best way to know if information is public is to see it in the newspaper or on television. Additional rules govern trades in company securities by directors, officers, and certain employees.
Remember these key points:
- Do not buy or sell securities of any company (or engage in similar transactions) based on non-public information.
- Do not pass inside information to someone at CNP who has no business need to know.
- Contact the Legal Department if you are not certain whether it is okay to buy or sell securities.
QUESTION: How do I know whether a gift or payment is improper or not?
ANSWER: A gift is improper if it is used to influence or if it could appear to influence a business decision or if it violates the law. Cash payments are never appropriate. If you think that a gift was given with “strings attached,” then it could be a questionable payment. You should contact the Legal Department or the Corporate Compliance Officer immediately.
QUESTION: I learned that some payments were recorded as advertising when they were actually for entertainment. Since the total amount that was spent is accurate, is this a problem if the expense coding is not exactly correct?
ANSWER: Yes, this could be a problem. Our books must be kept in reasonably accurate detail and reflect all of our transactions. False transactions or misrepresentations about our finances violate our Code and the law. Discuss this situation with your supervisor, Audit Services, or the Corporate Compliance Officer so that this practice is stopped and our records corrected.
QUESTION: I have access to our earnings information before it is released. A close friend was curious about our numbers. She knows I cannot say anything directly, but may I give her some hints?
ANSWER: Disclosures of any kind are inappropriate. This includes general statements, hints, gestures, or confirmations of a good guess. Never divulge confidential information before it is publicly released. If you do so, you could be found guilty of a crime.