The consolidated financial statements included in the Annual Report are the responsibility of Management and have been approved by the Board of Directors of the Company. These consolidated financial statements have been prepared by Management in accordance with generally accepted accounting principles (GAAP) in Canada and include amounts that are based on estimates and judgments. Financial information contained elsewhere in this Annual Report is consistent with the consolidated financial statements. Management has prepared Management’s Discussion and Analysis (MD&A) which is based on the Company’s finan- cial results prepared in accordance with Canadian GAAP. It compares the Company’s financial performance in 2001 to 2000 and should be read in conjunction with the consolidated financial statements and accompanying notes. In addition, significant changes between 2000 and 1999 are highlighted. Note 20 to the consolidated financial statements describes the impact on the consolidated financial statements of significant differences between Canadian and United States GAAP. Management has developed and maintains a system of internal accounting controls, including a program of internal audits. Management believes that these controls provide reasonable assurance that financial records are reliable and form a proper basis for preparation of financial statements. The internal accounting control process includes Management’s communication to employees of policies which govern ethical business conduct. The Board of Directors has appointed an Audit and Risk Management Committee consisting of unrelated, non-man- agement directors which meets at least four times during the year with Management and independently with each of the internal and external auditors and as a group. The Audit and Risk Management Committee reviews the consolidated finan- cial statements with Management and the external auditors before the consolidated financial statements are submitted to the Board of Directors for approval. The internal and external auditors have free access to the Audit and Risk Management Committee without obtaining prior Management approval. The independent external auditors, KPMG LLP, have been appointed by the shareholders to express an opinion as to whether the consolidated financial statements present fairly, in all material respects, the Company’s financial position, results of operations and cash flows in accordance with Canadian generally accepted accounting principles. The report of KPMG LLP on page 44 outlines the scope of their examination and their opinion on the consolidated financial statements. 2001 CONSOLIDATED FINANCIAL STATEMENTS REPORT OF MANAGEMENT February 25, 2002 RUSSELL K.GIRLING Executive Vice-President and Chief Financial Officer HAROLD N.KVISLE President and Chief Executive Officer 2001 ANNUAL REPORT  39