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The audit committee of our board of directors is comprised
of the seven directors named below. Each member of the committee is an independent
director as defined by the proposed New York Stock Exchange rules. In addition,
our board of directors has determined that Robert J. Swieringa, as defined
by SEC rules, is both independent and an audit committee financial expert.
Last year, we revised our written charter, which was then approved by our
board of directors. The revised charter, and the committee’s key practices,
are enclosed with this proxy statement as Appendix C at page 66 (Audit Committee Charter). Any changes
in the charter or key practices will be reflected on the governance section
of the GE Web site at www.ge.com/governance.
 We have reviewed and discussed the company’s audited financial statements
with management, which has primary responsibility for the financial statements.
KPMG LLP, our company’s independent auditor for 2002, is responsible
for expressing an opinion on the conformity of the company’s audited
financial statements with generally accepted accounting principles. The
committee has discussed with KPMG the matters that are required to be discussed
by Statement on Auditing Standards No. 61 (Communication With Audit Committees).
KPMG has provided to the committee the written disclosures and the letter
required by Independence Standards Board Standard No. 1 (Independence Discussions
with Audit Committees), and the committee discussed with KPMG that firm’s
independence. The committee also concluded that KPMG’s provision of
non-audit services, as described in the next section, to GE and its affiliates
is compatible with KPMG’s independence. The committee also met with
the company’s disclosure committee, which is responsible for evaluating
the fairness of our financial disclosures.
Based on the considerations referred to above, the committee recommended
to our board of directors that the audited financial statements be included
in our Annual Report on Form 10-K for 2002 and that KPMG be appointed independent
auditors for the company for 2003. The foregoing report is provided by the
following independent directors, who constitute the committee:
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