Message-ID: <18469721.1075858588671.JavaMail.evans@thyme> Date: Thu, 30 Aug 2001 16:11:28 -0700 (PDT) From: tana.jones@enron.com To: legal <.taylor@enron.com> Subject: FW: Please review request by auditors Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Jones, Tana X-To: Taylor, Mark E (Legal) X-cc: X-bcc: X-Folder: \MTAYLO1 (Non-Privileged)\Taylor, Mark E (Legal)\Archive\2001/08 X-Origin: Taylor-M X-FileName: MTAYLO1 (Non-Privileged).pst -----Original Message----- From: Hernandez, Nancy Sent: Thursday, August 30, 2001 6:00 PM To: Jones, Tana Subject: Please review request by auditors My Comments are in blue below. Please advise if its ok to release a copy of the report. Also feel free to make any comments as needed. Nancy -----Original Message----- From: carrie.a.richardson@us.andersen.com@ENRON [mailto:IMCEANOTES-carrie+2Ea+2Erichardson+40us+2Eandersen+2Ecom+40ENRON@ENRON.com] On Behalf Of carrie.a.richardson@us.andersen.com Sent: Thursday, August 30, 2001 3:55 PM To: Hernandez, Nancy Cc: jennifer.l.muse@us.andersen.com; s.jack.ehrig@us.andersen.com Subject: Additional Questions Nancy, In finishing our review of the Risk Controls Group, we have developed a few additional questions listed below: What are the procedures related to NYMEX violation limits? [Hernandez, Nancy] A COB report is run on every trading day. The report has hard coded limits set based on Nymex limits report provided by Tana Jones (legal). 1. What system is utilized in this monitoring process, and how often are NYMEX violations monitored? [Hernandez, Nancy] Daily Has there ever been any problems with this system? [Hernandez, Nancy] No. Data is captured based on Tagg deal entry attributes Could we obtain current copies of the reports that are used to monitor NYMEX violations? [Hernandez, Nancy] I would have to clear the issuance of the reports, but I don't think it would be an issue. 2. What procedures are performed when Enron is approaching a limit? [Hernandez, Nancy] Notification of Business Unit Risk Manager or Director. [Hernandez, Nancy] Report is issued daily to specific groups. Do traders notify you prior to exceeding a limit and do they perform monitoring procedures too? [Hernandez, Nancy] I am not sure if they do their own procedures. Who do you contact, and what is the timeline in regards to sending a letter to the NYMEX? [Hernandez, Nancy] No known correspondence with NyMex Could we get a copy of any recent correspondence with the NYMEX when Enron was approaching a limit? [Hernandez, Nancy] No know correspondence. 3. Are the procedures the same when you see a violation has occurred? Legal to answer What penalties are assessed for noncompliance? [Hernandez, Nancy] Legal to answer Have penalties ever been incurred? [Hernandez, Nancy] legal to Answer It is my understanding after talking to Jennifer Nguyen that you performed a reconciliation of all of the source systems to RisktRAC. Additionally, she indicated that since January, any new curve added is notified, documented, and monitored by the Risk Controls Group. What is this process? Are there any forms utilized? Would it be possible to get copies of the reconciliations performed and forms utilized, if any, in the addition of new curves? For inclusion in the AO1 Report, is it accurate that Credit inputs the data into Risky Business and the Risk Controls Group provides the report to upper management. If not, does Risk Controls Group input these deals not captured in the system? What is this process? If you have any questions, please feel free to call me at x56959. Please provide us responses at you earliest convenience and additionally the Risky Business Reports Jack Ehrig previously requested. Thank you, Carrie *******************Internet Email Confidentiality Footer******************* Privileged/Confidential Information may be contained in this message. If you are not the addressee indicated in this message (or responsible for delivery of the message to such person), you may not copy or deliver this message to anyone. In such case, you should destroy this message and kindly notify the sender by reply email. Please advise immediately if you or your employer do not consent to Internet email for messages of this kind. Opinions, conclusions and other information in this message that do not relate to the official business of my firm shall be understood as neither given nor endorsed by it.