UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                                   FORM 10-K

[X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
      ACT OF 1934
      For the fiscal year ended December 31, 2002
                                -----------------

                                      or

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
      EXCHANGE ACT OF 1934
      For the transition period from ______ to _______

<TABLE>
<CAPTION>
Commission        Name of Registrant, State of Incorporation,                                              IRS Employer
File Number       Address of Principal Executive Offices and Telephone Number                     Identification Number
-----------       -----------------------------------------------------------                     ---------------------
<S>                         <C>                                                                                 <C>
1-9894            ALLIANT ENERGY CORPORATION                                                                 39-1380265
                  (a Wisconsin corporation)
                  4902 N. Biltmore Lane
                  Madison, Wisconsin 53718
                  Telephone (608)458-3311

0-4117-1          INTERSTATE POWER AND LIGHT COMPANY                                                         42-0331370
                  (an Iowa corporation)
                  Alliant Energy Tower
                  Cedar Rapids, Iowa 52401
                  Telephone (319)786-4411

0-337             WISCONSIN POWER AND LIGHT COMPANY                                                          39-0714890
                  (a Wisconsin corporation)
                  4902 N. Biltmore Lane
                  Madison, Wisconsin 53718
                  Telephone (608)458-3311
</TABLE>

This combined Form 10-K is separately filed by Alliant Energy Corporation,
Interstate Power and Light Company and Wisconsin Power and Light Company.
Information contained in the Form 10-K relating to Interstate Power and Light
Company and Wisconsin Power and Light Company is filed by such registrant on
its own behalf.  Each of Interstate Power and Light Company and Wisconsin
Power and Light Company makes no representation as to information relating to
registrants other than itself.

Securities registered pursuant to Section 12 (b) of the Act:

<TABLE>
<CAPTION>
                                                                                              Name of Each
                                           Title of Class                                     Exchange on Which Registered
                                           --------------                                     ----------------------------
<S>                                                <C>                                               <C>
Alliant Energy Corporation                 Common Stock, $.01 Par Value                       New York Stock Exchange
Alliant Energy Corporation                 Common Stock Purchase Rights                       New York Stock Exchange
Interstate Power and Light Company         7-7/8% Quarterly Debt Capital Securities           New York Stock Exchange
                                              (Subordinated Deferrable Interest Debentures)
Wisconsin Power and Light Company          4.50% Preferred Stock, No Par Value                American Stock Exchange

</TABLE>

Securities registered pursuant to Section 12 (g) of the Act:  Wisconsin Power
   and Light Company Preferred Stock (Accumulation without Par Value)

<PAGE>

Indicate by check mark whether the registrants (1) have filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) have been subject to such
filing requirements for the past 90 days.  Yes [X]  No [  ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of the registrants' knowledge, in definitive proxy or information
statements incorporated by reference in Part III of the Form 10-K or any
amendment to this Form 10-K. [  ]

Indicate by check mark whether the registrants are accelerated filers (as
defined in Rule 12b-2 of the Exchange Act).
Alliant Energy Corporation          Yes [X]         No [ ]
Interstate Power and Light Company  Yes [ ]         No [X]
Wisconsin Power and Light Company   Yes [ ]         No [X]

The aggregate market value of the voting and non-voting common equity held by
nonaffiliates as of June 28, 2002:
Alliant Energy Corporation                 $2.32 billion
Interstate Power and Light Company         $--
Wisconsin Power and Light Company          $--

Number of shares outstanding of each class of common stock as of Feb. 28, 2003:

<TABLE>
<CAPTION>
<S>                                                              <C>
Alliant Energy Corporation                 Common stock, $0.01 par value, 92,658,243 shares outstanding

Interstate Power and Light Company         Common stock, $2.50 par value, 13,370,788 shares outstanding (all of which
                                           are owned beneficially and of record by Alliant Energy Corporation)

Wisconsin Power and Light Company          Common stock, $5 par value, 13,236,601 shares outstanding (all of which are
                                           owned beneficially and of record by Alliant Energy Corporation)

</TABLE>

                      DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Proxy Statements relating to Alliant Energy Corporation's and
Wisconsin Power and Light Company's 2003 Annual Meetings of Shareowners are,
or will be upon filing with the Securities and Exchange Commission,
incorporated by reference into Part III hereof.

                                       2
<PAGE>

<TABLE>
<CAPTION>
                                                 TABLE OF CONTENTS

                                                                                                      Page
                                                                                                     Number
                                                                                                     ------
<S>            <C>           <C>                                                                       <C>
Part I
              Item 1.      Business                                                                     6
              Item 2.      Properties                                                                  23
              Item 3.      Legal Proceedings                                                           25
              Item 4.      Submission of Matters to a Vote of Security Holders                         26
                           Executive Officers of the Registrants                                       26
Part II
              Item 5.      Market for Registrants' Common Equity and Related Stockholder
                              Matters                                                                  29
              Item 6.      Selected Financial Data                                                     30
              Item 7.      Management's Discussion and Analysis of Financial Condition and
                              Results of Operations                                                    32
              Item 7A.     Quantitative and Qualitative Disclosures About Market Risk                  56
              Item 8.      Financial Statements and Supplementary Data                                 56
              Item 9.      Changes in and Disagreements With Accountants on Accounting and
                              Financial Disclosure                                                    124
Part III
              Item 10.     Directors and Executive Officers of the Registrants                        124
              Item 11.     Executive Compensation                                                     124
              Item 12.     Security Ownership of Certain Beneficial Owners and Management             125
              Item 13.     Certain Relationships and Related Transactions                             126
              Item 14.     Controls and Procedures                                                    126
Part IV
              Item 15.     Exhibits, Financial Statement Schedules and Reports on Form 8-K            126
                           Signatures                                                                 134
                           Certifications                                                             137
                           Exhibit Index                                                              143

</TABLE>

                                       3
<PAGE>

<TABLE>
<CAPTION>
                                 DEFINITIONS

Certain abbreviations or acronyms used in the text and notes of this report are defined below:

Abbreviation or Acronym        Definition
-----------------------        ----------
<S>                               <C>
AFUDC                          Allowance for Funds Used During Construction
Alliant Energy                 Alliant Energy Corporation
ANR                            ANR Pipeline
APB                            Accounting Principles Board Opinion
ATC                            American Transmission Company LLC
Btu                            British Thermal Unit
CAA                            Clean Air Act
Calpine                        Calpine Corporation
Capstone                       Capstone Turbine Corporation
Cargill                        Cargill Incorporated
Cargill-Alliant                Cargill-Alliant, LLC
CIPCO                          Central Iowa Power Cooperative
Corporate Services             Alliant Energy Corporate Services, Inc.
DAEC                           Duane Arnold Energy Center
DNR                            Department of Natural Resources
DOE                            U.S. Department of Energy
Dth                            Dekatherm
EAC                            Energy Adjustment Clause
EBITDA                         Earnings Before Interest, Taxes, Depreciation and Amortization
EIP                            2002 Equity Incentive Plan
EITF                           Emerging Issues Task Force
EITF Issue 02-3                Issues Related to Accounting for Contracts Involved in Energy Trading and Risk
                               Management Activities
EITF Issue 98-10               Accounting for Contracts Involved in Energy Trading and Risk Management Activities
Enermetrix                     Enermetrix, Inc.
EPA                            U.S. Environmental Protection Agency
EPS                            Earnings Per Average Common Share
EWG                            Exempt Wholesale Generator
FASB                           Financial Accounting Standards Board
FERC                           Federal Energy Regulatory Commission
FIN                            FASB Interpretation No.
FIN 45                         Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect
                               Guarantees of Indebtedness to Others
FIN 46                         Consolidation of Variable Interest Entities
FUCO                           Foreign Utility Company
GAAP                           Accounting Principles Generally Accepted in the U.S.
ICC                            Illinois Commerce Commission
IES                            IES Industries Inc.
IESU                           IES Utilities Inc.
Integrated Services            Alliant Energy Integrated Services Company
International                  Alliant Energy International, Inc.
Investments                    Alliant Energy Investments, Inc.
IPC                            Interstate Power Company
IP&L                           Interstate Power and Light Company
IRS                            Internal Revenue Service
ISO                            Independent System Operator
IUB                            Iowa Utilities Board
Kewaunee                       Kewaunee Nuclear Power Plant
KV                             Kilovolt
KW                             Kilowatt
KWh                            Kilowatt-hour

                                       4
<PAGE>

Abbreviation or Acronym        Definition
-----------------------        ----------
LTEIP                          Long-Term Equity Incentive Plan
MAIN                           Mid-America Interconnected Network, Inc.
MAPP                           Mid-Continent Area Power Pool
McLeod                         McLeodUSA Incorporated
MD&A                           Management's Discussion and Analysis of Financial Condition and Results of Operations
MG&E                           Madison Gas & Electric Company
MGP                            Manufactured Gas Plants
Moody's                        Moody's Investors Service
MPUC                           Minnesota Public Utilities Commission
MW                             Megawatt
MWh                            Megawatt-hour
NEIL                           Nuclear Electric Insurance Limited
NEPA                           National Energy Policy Act of 1992
NERC                           North American Electric Reliability Council
NGPL                           Natural Gas Pipeline Co. of America
NMC                            Nuclear Management Company, LLC
NNG                            Northern Natural Gas Company
NOx                            Nitrogen Oxides
NRC                            Nuclear Regulatory Commission
NWPA                           Nuclear Waste Policy Act of 1982
PSCW                           Public Service Commission of Wisconsin
PUHCA                          Public Utility Holding Company Act of 1935
Resources                      Alliant Energy Resources, Inc.
SEC                            Securities and Exchange Commission
SFAS                           Statement of Financial Accounting Standards
SFAS 115                       Accounting for Certain Investments in Debt and Equity Securities
SFAS 133                       Accounting for Derivative Instruments and Hedging Activities
SFAS 143                       Accounting for Asset Retirement Obligations
SmartEnergy                    SmartEnergy, Inc.
South Beloit                   South Beloit Water, Gas and Electric Company
Southern Hydro                 Southern Hydro Partnership
STB                            U.S. Surface Transportation Board
Synfuel                        Alliant Energy Synfuel LLC
TBD                            To Be Determined
TRANSLink                      TRANSLink Transmission Company LLC
Transportation                 Alliant Energy Transportation, Inc.
U.S.                           United States of America
WEPCO                          Wisconsin Electric Power Company
Whiting                        Whiting Petroleum Corporation
WP&L                           Wisconsin Power and Light Company
WPLH                           WPL Holdings, Inc.
WPSC                           Wisconsin Public Service Corporation
WUHCA                          Wisconsin Utility Holding Company Act

</TABLE>
                                       5
<PAGE>

FORWARD-LOOKING STATEMENTS
Refer to "Forward-Looking Statements" in MD&A for information and disclaimers
regarding forward-looking statements contained in this Annual Report on Form
10-K.

                                    PART I

This Annual  Report on Form 10-K includes  information  relating to Alliant
Energy,  IP&L and WP&L (as well as  Resources  and  Corporate  Services).  Where
appropriate,  information  relating to a specific entity has been segregated and
labeled  as such.  At Dec.  31,  2002,  the assets  and  liabilities  of Alliant
Energy's  oil and gas  (Whiting),  Australian  (including  Southern  Hydro)  and
affordable  housing  businesses  were classified as held for sale. The operating
results for these  non-regulated  businesses for all periods presented have been
separately  classified  and  reported  as  discontinued  operations  in  Alliant
Energy's Consolidated  Financial Statements and Notes to Consolidated  Financial
Statements included in this Annual Report.  Refer to Note 16 of Alliant Energy's
"Notes to Consolidated Financial Statements" for additional information. On Jan.
1, 2002, IPC merged with and into IESU and IESU changed its name to IP&L. IP&L's
Consolidated Financial Statements and Notes to Consolidated Financial Statements
included in this Annual Report  illustrate the impact of the merger as if it had
occurred as of Jan. 1, 2000.

ITEM 1.  BUSINESS

A.    GENERAL
In April 1998, IES, WPLH and IPC completed a merger resulting in Alliant
Energy.  The primary first tier subsidiaries of Alliant Energy include: IP&L,
WP&L, Resources and Corporate Services.  Among various other regulatory
constraints, Alliant Energy is operating as a registered public utility
holding company subject to the limitations imposed by PUHCA.  Alliant Energy
was incorporated in Wisconsin in 1981.  A brief description of the primary
first-tier subsidiaries of Alliant Energy is as follows:

1)  IP&L - incorporated in Iowa in 1925 as Iowa Railway and Light
Corporation.  IP&L is a public utility engaged principally in the generation,
transmission, distribution and sale of electric energy; the purchase,
distribution, transportation and sale of natural gas; and the provision of
steam services in selective markets, in Iowa, Minnesota and Illinois.  In
Iowa, non-exclusive franchises, which cover the use of streets and alleys for
public utility facilities in incorporated communities, are granted for a
maximum of 25 years by a majority vote of local qualified residents.  At Dec.
31, 2002, IP&L supplied electric and gas service to 526,284 and 234,853
(excluding transportation and other) customers, respectively.  In 2002, 2001
and 2000, IP&L had no single customer for which electric, gas and/or steam
sales accounted for 10% or more of IP&L's consolidated revenues.

2)  WP&L - incorporated in Wisconsin in 1917 as Eastern Wisconsin Electric
Company, is a public utility engaged principally in the generation,
distribution and sale of electric energy; the purchase, distribution,
transportation and sale of natural gas; and the provision of water services
in selective markets.  Nearly all of WP&L's customers are located in south
and central Wisconsin.  WP&L operates in municipalities pursuant to permits
of indefinite duration, which are regulated by Wisconsin law.  At Dec. 31,
2002, WP&L supplied electric and gas service to 430,406 and 170,123
(excluding transportation and other) customers, respectively.  WP&L also had
19,527 water customers.  In 2002, 2001 and 2000, WP&L had no single customer
for which electric, gas and/or water sales accounted for 10% or more of
WP&L's consolidated revenues.  WPL Transco LLC is a wholly-owned subsidiary of
WP&L and holds WP&L's investment in ATC.  WP&L also owns all of the
outstanding capital stock of South Beloit, a public utility supplying
electric, gas and water service, principally in Winnebago County, Illinois,
which was incorporated in 1908.

3)  RESOURCES - incorporated in 1988 in Wisconsin, the majority of Alliant
Energy's non-regulated investments are organized under Resources.  Resources'
significant wholly-owned subsidiaries at Dec. 31, 2002 include International,
Alliant Energy Generation, Inc., Integrated Services, Investments,
Transportation, Whiting and SmartEnergy.  Refer to "D. Information Relating
to Non-regulated Operations" for additional details.

4)  CORPORATE SERVICES - subsidiary formed to provide administrative services
to Alliant Energy and its subsidiaries as required under PUHCA.

                                       6
<PAGE>

Refer to Note 13 of the "Notes to Consolidated Financial Statements" for
further discussion of business segments, which information is incorporated
herein by reference.

B.    INFORMATION RELATING TO ALLIANT ENERGY ON A CONSOLIDATED BASIS

1)  EMPLOYEES
As of Dec. 31, 2002, Alliant Energy had the following employees (full-time
and part-time):

<TABLE>
<CAPTION>
                                                                                              Percentage
                                                       Number of            Number of        of Workforce
                                   Number of        Bargaining Unit        Bargaining         Covered by
                                   Employees           Employees           Agreements         Agreements
                                  -------------     -----------------     --------------    ----------------
<S>                                    <C>                <C>                   <C>              <C>
IP&L                                   1,692              1,426                  7                84%
WP&L                                   1,541              1,456                  1                94%
Resources:
   International (a)                   3,135                 --                 --                --
   Integrated Services                   647                 --                 --                --
   Investments (a)                       246                 81                  5                33%
   Other                                  83                 --                 --                --
Corporate Services                     1,626                 --                 --                --
                                  -------------     -----------------     --------------
                                       8,970              2,963                 13                33%
                                  =============     =================     ==============

</TABLE>

(a) Includes employees of Alliant Energy's discontinued operations, which
  represented approximately 2% of total employees at Dec. 31, 2002.

In 2003, five bargaining agreements expire representing approximately 51% of
employees covered under bargaining agreements and 17% of total Alliant Energy
employees.  Alliant Energy has not experienced any significant work stoppage
problems in the past.  While negotiations have commenced, Alliant Energy is
currently unable to predict the outcome of these negotiations.

2)  CAPITAL EXPENDITURE AND INVESTMENT PLANS
Refer to "Liquidity and Capital Resources - Construction and Acquisition
Expenditures" in MD&A for discussion of anticipated construction and
acquisition expenditures for 2003-2005.  Refer to "C. Information Relating to
Domestic Utility Operations - 1) Electric Utility Operations - Power Supply"
for information related to IP&L's and WP&L's plans for the development of new
electric generation in Iowa and Wisconsin, respectively.

3)  REGULATION
Alliant Energy operates as a registered public utility holding company
subject to regulation by the SEC under PUHCA.  Alliant Energy and its
subsidiaries are subject to the regulatory provisions of PUHCA, including
provisions relating to the issuance and sales of securities, acquisitions and
sales of certain utility properties, acquisitions and retention of interests
in non-utility businesses and the services provided by Corporate Services to
Alliant Energy and its subsidiaries.

Alliant Energy is subject to regulation by the PSCW.  The PSCW regulates,
among other things, the type and amount of Alliant Energy's investments in
non-utility businesses.  WP&L is also subject to regulation by the PSCW as to
retail utility rates and service, accounts, issuance and use of proceeds of
securities, certain additions and extensions to facilities and in other
respects.  WP&L is required to file a rate case with the PSCW at least every
two years based on a forward-looking test year period.

IP&L operates under the jurisdiction of the IUB.  The IUB has authority to
regulate rates and standards of service, to prescribe accounting requirements
and to approve the location and construction of electric generating
facilities having a capacity in excess of 25,000 KW.  Requests for rate
relief are based on historical test periods, adjusted for certain known and
measurable changes.  The IUB must decide on requests for rate relief within
10 months of the date of the application for which relief is filed or the
interim prices granted become permanent.  Interim rates, if allowed, are
permitted to become effective, subject to refund, no later than 90 days after
the rate increase application is filed.

                                       7
<PAGE>

IP&L is also subject to regulation by the MPUC.  Requests for rate relief can
be based on either historical or projected data.  The MPUC must reach a final
decision within 10 months.  Interim rates are permitted.  The MPUC also has
jurisdiction to approve IP&L's capital structure on an annual basis.  In
addition, IP&L and South Beloit are subject to regulation by the ICC for
retail utility rates and service, accounts, issuance and use of proceeds of
securities, certain additions and extensions to facilities and in other
respects.  Requests for rate relief must be decided within 11 months.

FERC has jurisdiction under the Federal Power Act over certain of the
electric utility facilities and operations, wholesale rates and accounting
practices of IP&L and WP&L, and in certain other respects.  In addition,
certain natural gas facilities and operations of IP&L and WP&L are subject to
the jurisdiction of FERC under the Natural Gas Act.

With respect to environmental matters, the EPA administers certain federal
statutes and has delegated the administration of other environmental
initiatives to the applicable state environmental agencies.  In addition, the
state agencies have jurisdiction over air and water quality standards
associated with certain electric generation and the level and flow of water,
safety and other matters pertaining to hydroelectric generation.

IP&L and WP&L are directly and indirectly subject to the jurisdiction of the
NRC, with respect to DAEC and Kewaunee, respectively, and to the jurisdiction
of the DOE with respect to the disposal of nuclear fuel and other radioactive
wastes from DAEC and Kewaunee.

At Dec. 31, 2002, Alliant Energy's remaining investment authority under the
100% of consolidated retained earnings PUHCA order was approximately $200
million of future EWG and/or FUCO investments with financings that have
recourse to the parent company in addition to certain commitments already
made.

The electricity industry in Brazil, as it relates to Alliant Energy's
unconsolidated investments, is regulated by the Brazilian federal government,
acting through the Ministry of Mines and Energy, which has exclusive
authority over the electricity sector through regulatory powers assigned to
it.  Regulatory policy for the sector is implemented by an autonomous
national electric energy agency (Agencia Nacional de Energia Eletrica or
"ANEEL"), which delegates certain functions to agencies based in certain
states of Brazil.  However, ANEEL cannot delegate any authority regarding
tariffs to state agencies.  In January 2003, a new Minister of Mines and
Energy was appointed thus the comprehensive review of the regulatory process
and policies that was underway in 2002 has ceased and a new plan has since
been announced.  This plan includes a pooling of generation so that all
companies will have access to lower energy prices, use of a different
inflation index for purposes of tariff setting and aid from the national
development bank.  Although details of the plan are unknown at this time,
Alliant Energy believes the plan will not have a material adverse impact on
Alliant Energy's investments in Brazil.

Refer to Note 2 of Alliant Energy's "Notes to Consolidated Financial
Statements" and "Rates and Regulatory Matters" in MD&A for additional
information regarding regulation and utility rate matters.

4)  STRATEGIC ACTIONS
Refer to "Strategic Actions" in MD&A for a discussion of various strategic
actions Alliant Energy is taking to strengthen its financial profile.

C.    INFORMATION RELATING TO DOMESTIC UTILITY OPERATIONS
Alliant Energy realized 50%, 44%, 4% and 2% of its 2002 electric utility
revenues in Iowa, Wisconsin, Minnesota and Illinois, respectively.
Approximately 91% of the electric revenues were regulated by the respective
state commissions while the other 9% were regulated by FERC.  Alliant Energy
realized 50%, 44%, 3% and 3% of its 2002 gas utility revenues in Iowa,
Wisconsin, Minnesota and Illinois, respectively.

IP&L realized 91%, 7% and 2% of its 2002 electric utility revenues in Iowa,
Minnesota and Illinois, respectively.  Approximately 96% of IP&L's 2002
electric revenues were regulated by the respective state commissions while
the other 4% were regulated by FERC.  IP&L realized 93%, 5% and 2% of its
2002 gas utility revenues in Iowa, Minnesota and Illinois, respectively.
WP&L realized 98% of its 2002 electric utility revenues in Wisconsin and 2%

                                       8
<PAGE>

in Illinois.  Approximately 84% of WP&L's 2002 electric revenues were
regulated by the PSCW or the ICC while the other 16% were regulated by FERC.
WP&L realized 97% of its 2002 gas utility revenues in Wisconsin and 3% in
Illinois.

1)  ELECTRIC UTILITY OPERATIONS
General - The utilities provide electric service in Iowa, southern and
central Wisconsin, southern Minnesota and northern and northwestern
Illinois.  The number of electric customers and communities served by each
utility at Dec. 31, 2002 was as follows:

<TABLE>
<CAPTION>
              Retail Customers     Wholesale Customers        Other Customers       Communities Served
              -----------------   -----------------------   --------------------   ----------------------
<S>                  <C>                   <C>                       <C>                    <C>
IP&L                524,956                10                        1,318                  760
WP&L                428,390                30                        1,986                  602
              -----------------   -----------------------   --------------------   ----------------------
                    953,346                40                        3,304                1,362
              =================   =======================   ====================   ======================

</TABLE>

2002 electric utility operations accounted for 80% and 81% of operating
revenues and 90% and 90% of operating income for IP&L and WP&L,
respectively.

Electric sales are seasonal to some extent with the annual peak normally
occurring in the summer months.  In 2002, the maximum peak hour demands for
IP&L and WP&L were 3,097 MW on July 8, 2002 and 2,674 MW on Aug. 1, 2002,
respectively.  In 2002, the maximum peak hour demand for Alliant Energy was
5,729 MW on July 8, 2002, which was the coincident peak of the entire Alliant
Energy system.  IP&L and WP&L are members of the MAIN Regional Reliability
Council which is one of the 10 regional members of NERC.  Each regional
member of NERC is responsible for maintaining reliability in its area through
coordination of planning and operations.

In 2001, IP&L and five other electric utility companies filed an application
with FERC to create TRANSLink, a for-profit, transmission-only company.  In
April 2002, FERC conditionally approved the formation of TRANSLink and
TRANSLink's participation in the Midwest ISO.  In June 2002, TRANSLink
Development Co. LLC was formed to oversee the start-up activities for
TRANSLink.  In the fourth quarter of 2002, three additional electric utility
companies joined TRANSLink.  Current plans call for IP&L to contribute
transmission assets of 69 KV and greater, which have an estimated net book
value of approximately $226 million (as of Dec. 31, 2002), to TRANSLink in
exchange for a yet to be determined combination of a corresponding ownership
interest in TRANSLink and cash.  IP&L filed for the necessary state approvals
in the fourth quarter of 2002. TRANSLink is currently expected to be
operational in the third quarter of 2003 and will be the transmission network
provider to approximately 7.7 million customers in 13 states.

The PSCW issued a final ruling in October 2002 regarding incremental electric
transmission costs, which allows Wisconsin utilities, including WP&L, to
continue to defer any such costs related to retail service for five years
with deferred amounts included in future base rate cases.  During this
period, changes in electric transmission costs will have no material impact
on WP&L's results of operations.

WP&L, including South Beloit, transferred its transmission assets with no
gain or loss (approximate net book value of $186 million) to a
transmission-only company, ATC, on Jan. 1, 2001.  WP&L received a tax-free
cash distribution of $75 million from ATC and had a $112 million equity
investment in ATC, with an ownership percentage of approximately 26.6% at
Dec. 31, 2002.  This transfer has not resulted in a significant impact on
WP&L's financial condition or results of operations since FERC allows ATC to
earn a return on the contributed assets comparable to the return formerly
allowed WP&L by the PSCW and FERC.  In addition, incremental start-up and
ongoing transmission costs are being recovered in rates.  During 2002, ATC
returned approximately 80% of its earnings to the equity holders and,
although no assurance can be given, Alliant Energy anticipates ATC will
continue with this policy in the future.  ATC realizes its revenues from the
provision of transmission services to both participants in ATC as well as
non-participants.  ATC is a transmission-owning member of the Midwest ISO and
the MAIN Regional Reliability Council.

IP&L maintains and operates transmission and substation facilities connecting
with its high voltage transmission systems pursuant to a non-cancelable
operation agreement (the Operating Agreement) with CIPCO.  The Operating

                                       9
<PAGE>

Agreement, which will terminate on Dec. 31, 2035, provides for the joint use
of certain transmission facilities of IP&L and CIPCO.  IP&L has transmission
interconnections at various locations with nine other transmission owning
utilities in the Midwest.  WP&L transferred its transmission and substation
facilities to ATC on Jan. 1, 2001 and ATC has transmission interconnections
at various locations.  These interconnections enhance the overall reliability
of the Alliant Energy transmission system and provide access to multiple
sources of economic and emergency energy.

Refer to "Properties" for additional information regarding electric
properties.

Fuel - Refer to the Electric Operating Information tables for details on the
sources of electric energy for Alliant Energy, IP&L and WP&L from 1998 to
2002.  The average cost of fuel per million Btu's used for electric
generation was as follows:

<TABLE>
<CAPTION>
                                IP&L                                      WP&L
               ----------------------------------------  ----------------------------------------
                   2002         2001          2000           2002        2001          2000
               ----------------------------------------  ----------------------------------------
<S>                 <C>          <C>           <C>            <C>         <C>           <C>
Coal              $1.067       $0.991        $0.981         $1.262      $1.146        $1.152
Nuclear            0.572        0.608         0.594          0.457       0.423         0.424
All Fuels          1.032        1.046         1.014          1.234       1.158         1.115

</TABLE>

Coal - Alliant Energy, through Corporate Services, IP&L and WP&L, has entered
into contracts with different suppliers to ensure that a specified supply of
coal is available at known prices for IP&L and WP&L for 2003 through 2006.
These contracts provide for a portfolio of coal supplies that cover
approximately 94%, 68%, 49% and 23% of the total utilities' estimated coal
supply needs for 2003 through 2006, respectively.  Management believes this
portfolio of coal supplies represents a reasonable balance between the risks
of insufficient supplies and those associated with larger open positions
subject to price volatility in the coal markets.  Remaining coal requirements
will be met from either future contracts or purchases in the spot market.

The majority of the coal utilized by IP&L and WP&L is from the Wyoming Powder
River Basin.  A majority of this coal is transported by rail-car directly
from Wyoming to IP&L's and WP&L's generating stations, with the remainder
transported from Wyoming to the Mississippi River by rail-car and then via
barges to the final destination.  As protection against interruptions in coal
deliveries, IP&L and WP&L maintain average coal inventories of 30 to 50 days
for generating stations with year-round deliveries and 30 to 150 days
(depending upon time of the year) for generating stations with seasonal
deliveries.

Average delivered fossil fuel costs are expected to increase in the future
due to price/rate structures and adjustment provisions in existing coal and
transportation contracts and recent coal market trends.  Existing coal
contracts with terms of greater than one year have fixed future year prices
that generally reflect recent upward market trends.   Other factors which may
impact coal prices are related to changes in various associated laws and
regulations.  For example, sulfur dioxide and NOx emission restrictions and
other environmental limitations on generating stations have increased
significantly and proposed additional restrictions (including some for
mercury emissions), if enacted, will likely further increase the difficulty
and cost of obtaining adequate coal supplies.  Rate adjustment provisions in
transportation contracts are primarily based on changes in the Rail Cost
Adjustment Factor as published by the STB.  Refer to Note 1(j) for discussion
of IP&L's and WP&L's rate recovery of fuel costs, Note 10(a) for information
on coal derivatives and Note 11(b) for details relating to coal purchase
commitments in the "Notes to Consolidated Financial Statements."

Purchased-Power - During 2002, approximately 23% and 30% of IP&L's and WP&L's
total MWh requirements, respectively, were met through purchased-power.
Refer to Notes 3 and 11(b) of the "Notes to Consolidated Financial
Statements" for details relating to purchased-power commitments.

Nuclear - Alliant Energy owns interests in two nuclear facilities, DAEC and
Kewaunee.  DAEC, a 580 MW (net capacity) boiling water reactor plant, is
operated by the NMC under contract to IP&L, which has a 70% ownership
interest in the plant.  The owners of DAEC are responsible for the
decommissioning of the plant.  The DAEC operating license expires in 2014.
Kewaunee, a 532 MW (net capacity) pressurized water reactor plant, is
operated by the NMC under contract to WPSC and is jointly owned by WPSC (59%)

                                       10
<PAGE>

and WP&L (41%).  WPSC and WP&L are responsible for the decommissioning of the
plant.  The Kewaunee operating license expires in 2013.  WPSC is considering
whether or not to seek extension of the operating license to 2033.

Alliant Energy Nuclear LLC, a non-utility subsidiary of Alliant Energy, has a
20% ownership interest in the NMC.  The purpose of the NMC is to consolidate
operation of the nuclear plants owned by the NMC partners and to provide
similar capability for other nuclear plant operators and owners.
Consolidation of operation by the NMC is expected to sustain long-term
safety, optimize reliability and improve the operational performance of the
nuclear generating plants.  The NMC currently operates eight nuclear
generating units at six sites.  The NMC partners continue to individually own
their plants through their utility subsidiaries, are entitled to energy
generated at the plants and retain the financial obligations for the safe
operation, maintenance and decommissioning of the plants.

As co-owners of nuclear generating units, IP&L and WP&L are subject to the
jurisdiction of the NRC.  The NRC has broad supervisory and regulatory
jurisdiction over the construction and operation of nuclear reactors,
particularly with regard to public health, safety and environmental
considerations.  The operation and design of nuclear power plants is under
constant review by the NRC.  IP&L's and WP&L's anticipated nuclear-related
construction expenditures for 2003-2005 are approximately $70 million and $32
million, respectively.

Kewaunee is subject to additional inspections related to reactor vessel head
cracking found at other pressurized water reactor plants.  After evaluating
the cost of continued required inspections of the existing reactor vessel
head, WPSC and WP&L have submitted a construction authorization request to
the PSCW for replacement of the reactor vessel head.  The replacement is
scheduled to occur during the fall 2004 refueling outage at a total cost of
approximately $20 million (WP&L's share is approximately $8 million).  In
2001, a steam generator replacement was completed at Kewaunee.

On Feb. 25, 2002, the NRC issued an order to all licensees formalizing their
requirements for additional security resulting from the Sept. 11, 2001
terrorist attacks on the U.S.  Prior to this order, the additional security
measures were voluntary based on NRC guidance.  The NMC, as operator of DAEC
and Kewaunee, responded to the NRC and has fully implemented the additional
security measures.  The issue of cost recovery for DAEC is being addressed in
IP&L's pending retail rate case.  In December 2001, the PSCW authorized WP&L
to defer incremental costs for security measures and insurance premiums
related to the Sept. 11, 2001 terrorist attacks.  WP&L began deferring the
increased costs in December 2001 and the issue of cost recovery is being
addressed in WP&L's pending 2003 retail rate case.

In 2000, the NRC issued expanded performance measures, which raised several
areas of concern with Kewaunee's operations.  Addressing the NRC's concerns
and ensuring that Kewaunee operates in accordance with current industry and
regulatory standards resulted in additional operating costs.  WP&L has
deferred $5.5 million of such costs at Dec. 31, 2002.  The incremental and
deferred amounts are currently being collected in WP&L's 2002 retail rate
increase.

Public liability for nuclear accidents is governed by the Price-Anderson Act
of 1988 as amended (Act), which sets a statutory limit of $9.55 billion for
liability to the public for a single nuclear power plant incident and
requires nuclear power plant operators to provide financial protection for
this amount.  As required, IP&L provides this financial protection for a
nuclear incident at DAEC through a combination of liability insurance
($300 million) and industry-wide retrospective payment plans ($9.25 billion).
Under the industry-wide plan, each operating licensed nuclear reactor in the
U.S. is subject to an assessment in the event of a nuclear incident at any
nuclear plant in the U.S.  IP&L, as a 70% owner of DAEC, could be assessed a
maximum of $61.7 million per nuclear incident, with a maximum of $7 million
per incident per year, if losses relating to the incident exceeded $300
million.  These limits are subject to adjustments for changes in the number
of participants and inflation in future years.  Similarly, WP&L, as a 41%
owner of Kewaunee, is subject to an overall assessment of approximately $36.1
million per incident, not to exceed $4.1 million payable in any given year.
The Act expired on Aug. 1, 2002, with no impact to IP&L or WP&L as existing
nuclear power plants are covered under the insurance system of the Act for
the remainder of their operating lives.  It is anticipated that extension or
renewal of the Act will apply only to new construction.  Currently there is
legislation pending in the U.S. Congress that includes extensions of the Act,
increasing the statutory limit for liability to the public for a single
nuclear power plant incident and increasing the maximum annual assessment per
incident.

                                       11
<PAGE>

IP&L and WP&L are members of NEIL, which provides $1.5 billion of insurance
coverage for DAEC and $1.8 billion for Kewaunee on certain property losses
for property damage, decontamination and premature decommissioning.  The
proceeds from such insurance, however, must first be used for reactor
stabilization and site decontamination before they can be used for plant
repair and premature decommissioning.  NEIL also provides separate coverage
for additional expenses incurred during certain outages.  Owners of nuclear
generating stations insured through NEIL are subject to retroactive premium
adjustments if losses exceed accumulated reserve funds.  NEIL's accumulated
reserve funds are currently sufficient to more than cover its exposure in the
event of a single incident under the primary and excess property damage or
additional expense coverages.  However, IP&L could be assessed annually a
maximum of $3.3 million for NEIL primary property, $3.2 million for NEIL
excess property and $2.4 million for NEIL additional expenses if losses
exceed the accumulated reserve funds.  WP&L could be assessed annually a
maximum of $1.7 million for NEIL primary property, $3.3 million for NEIL
excess property and $1.0 million for NEIL additional expense coverage.  IP&L
and WP&L are not currently aware of any losses that they believe are likely
to result in an assessment.

In the event of a catastrophic loss at DAEC or Kewaunee, the amount of
insurance available may not be adequate to cover property damage,
decontamination and premature decommissioning.  Uninsured losses, to the
extent not recovered through rates, would be borne by IP&L or WP&L, as the
case may be, and could have a material adverse effect on their financial
condition and results of operations.

The NWPA assigned responsibility to the DOE to establish a facility for the
ultimate  disposition  of high level waste and spent nuclear fuel and authorized
the DOE to enter into  contracts  with parties for the disposal of such material
beginning in 1998, in exchange for payments by contract holders. IP&L (for DAEC)
and WPSC (for  Kewaunee)  entered into such  contracts  and have made the agreed
payments to the Nuclear Waste Fund held by the U.S. Treasury. The companies were
subsequently  notified  by the DOE that it was not able to begin  acceptance  of
spent nuclear fuel by the 1998 deadline.  Furthermore,  the DOE has  experienced
significant  delays in its efforts and  material  acceptance  is now expected to
occur no earlier than 2010 with the  possibility  of further delay being likely.
Alliant  Energy  continues  to monitor and  evaluate its options for recovery of
damages due to the DOE's  delay in  accepting  spent  nuclear  fuel.  The DOE is
currently  preparing an  application  to license a permanent  spent fuel storage
facility in the Yucca Mountain area of Nevada.

The NWPA also assigned responsibility for interim storage of spent nuclear
fuel to generators of such spent nuclear fuel, such as IP&L and WPSC.  In
accordance with this responsibility, IP&L and WPSC have been and will
continue storing spent nuclear fuel on site at DAEC and Kewaunee,
respectively, until removal of all spent nuclear fuel by the DOE to its
permanent repository occurs.  Interim storage activities at reactor sites,
regardless of DOE delays or acceptance schedules, will extend after final
reactor shutdown.  Construction of a dry cask storage facility by IP&L at
DAEC has been completed and transfer of used fuel into the facility is
expected to begin in 2003.  The storage facility will provide assurance that
both the operating and post-shutdown storage needs of DAEC are satisfied.
Kewaunee has sufficient fuel storage capacity to store all of the fuel it
will generate through 2009.  No decisions have been made concerning
additional storage capacity needed beyond 2009.

The Low-Level Radioactive Waste Policy Amendments Act of 1985 mandates that
each state must take responsibility for the storage of low-level radioactive
waste produced within its borders.  The States of Iowa and Wisconsin are
members of the six-state Midwest Interstate Low-Level Radioactive Waste
Compact (Compact), which is responsible for development of any new disposal
capability within the Compact member states.  Disposal facilities located
near Barnwell, South Carolina and Clive, Utah continue to accept the
low-level waste from DAEC and Kewaunee, thereby minimizing the amount of
low-level waste stored on-site.  Given technological advances, waste
compaction and the reduction in the amount of waste generated, DAEC and
Kewaunee each have on-site storage capability sufficient to store low-level
waste expected to be generated over at least the next 10 years.  While the
operators of DAEC and Kewaunee are unable to predict how long these
facilities will continue to accept their waste, continuing access to these
facilities expands their on-site storage capability indefinitely.

WPSC purchases uranium concentrates, conversion services, enrichment
services, and fabrication services for nuclear fuel assemblies at Kewaunee.
New fuel assemblies replace used assemblies that are removed from the reactor
every 18 months and placed in storage at the plant site pending removal by
the DOE.  Uranium concentrates, conversion services, and enrichment services
are purchased at spot market prices, through a bid process, or using existing
contracts.  Conversion services are complete for the nuclear fuel reload
scheduled in 2003.  WPSC has contracted for a fixed quantity of enrichment

                                       12
<PAGE>

services through 2004.  Additional enrichment services will be acquired under
an existing contract or by purchases on the spot market.  WPSC has contracted
for fuel fabrication services for the next six reloads.  WPSC's uranium
inventory policy is to maintain sufficient inventory for up to two reloads of
fuel.  At Dec. 31, 2002, approximately 160,000 pounds of yellowcake (a
processed form of uranium ore) or its equivalent was held in inventory for
the plant.  Each refueling requires approximately 500,000 pounds of
yellowcake.  In 2003, approximately 825,000 pounds of yellowcake will be
acquired to meet the requirements of the inventory policy.

Uranium and enrichment services for the Spring 2003 refueling outage at DAEC
have been completed.  IP&L believes that an ample supply of uranium and
enrichment services will be available in the future and intends to continue
its strategy of purchasing such uranium and enrichment services as necessary
on the spot market and/or via medium length (less than five years) contracts
to meet its generation requirements.  These sources of supply will be used to
meet delivery requirements for an early 2005 refueling outage.  Arrangements
for the fabrication of nuclear fuel are in place through the 2011 refueling
of DAEC.

Additional discussions of various other nuclear issues relating to DAEC and
Kewaunee are included in Notes 1, 3, 9, 10(c), 11(e), 11(f) and 12 of the
"Notes to Consolidated Financial Statements."

Power Supply - Wisconsin enacted electric reliability legislation in 1998
(Wisconsin Reliability Act) with the goal of assuring reliable electric
energy for Wisconsin.  The law allows the construction of merchant power
plants in the state and streamlines the regulatory approval process for
building new generation and transmission facilities.  The PSCW is authorized
to order construction of new transmission facilities, based on the findings
of its regional transmission constraint study, through Dec. 31, 2004.  In
October 2001, the PSCW approved the construction of a 345 KV transmission
line, which will improve transmission import capabilities in Wisconsin.
Re-approval of the project due to significant cost increases is expected
during the summer of 2003 by the PSCW.  WP&L notes that it may take time for
new transmission and power plant projects to be approved and built in
Wisconsin.

In 2000, WP&L and Calpine announced an agreement whereby Calpine would build,
own and operate a 600 MW natural gas-fired combined cycle power plant in
Wisconsin at WP&L's Rock River plant (Riverside project).  WP&L has entered
into a purchased-power agreement for 453 MW of this plant's output, which is
anticipated to be available prior to the time of the 2004 summer peak
demand.  Construction began in September 2002 and is expected to assist WP&L
in meeting its growing demands for electricity, to place a greater reliance
on generation physically located in Wisconsin versus power purchased from
outside of Wisconsin and to help WP&L maintain the required 18% reserve
margin in Wisconsin.

The Iowa Legislature passed a bill in 2001 to encourage construction of new
generating facilities in Iowa.  In 2001, Alliant Energy's subsidiaries
announced their interest in developing new electric generation capacity in
Iowa and Wisconsin over the next 10 years with an estimated investment of
$2.5 billion.  IP&L announced a willingness to develop up to 1,200 MW of new
electric generation over the next 10 years.  Currently, Alliant Energy's
Power Iowa plan includes adding approximately 550 MW of natural gas-fired
generation (500 MW by 2004), 100 MW of capacity generated from renewable
energy sources by December 2003, researching options for an additional
500-600 MW of generation and increases in energy efficiency through energy
conservation and process improvements at various commercial and industrial
customer locations.  In January 2003, the IUB approved IP&L's siting
certificate for a 500 MW natural gas-fired plant in Mason City, Iowa and
construction began.  In addition, in December 2002, IP&L began purchasing
approximately 57 MW of capacity from a wind generation facility in Iowa.  In
Wisconsin, Alliant Energy's current plans are to install approximately 800 MW
of additional electric generation over the next 10 years, including
approximately 500-700 MW of base and/or intermediate generation and
approximately 100-300 MW of simple-cycle gas generation.

WP&L currently anticipates meeting its 2003 power supply requirements,
including the required 18% reserve margin, through a variety of incremental
power supply resources which include, but are not limited to, renegotiated
purchased-power contracts from current suppliers utilizing existing firm
transmission rights to replace currently expiring purchased-power contracts
and additional power purchases from existing generating units located within
and outside of Wisconsin.  The largest challenge that WP&L faces in securing
power supply resources necessary to meet its 2003 requirements is the lack of
available incremental firm transmission service to import additional power

                                       13
<PAGE>

supply resources into WP&L's load-serving area from bulk power supply sources
outside of Wisconsin.  While Alliant Energy currently expects to meet utility
customer demands in 2003, unanticipated reliability issues could still arise
in the event of unexpected power plant outages, transmission system outages
or extended periods of extremely hot weather.

Refer to "Liquidity and Capital Resources - Construction and Acquisition
Expenditures" in MD&A for additional information.

Electric Environmental Matters - Alliant Energy is regulated in environmental
matters by a number of federal, state and local agencies.  Such regulations
are the result of a number of environmental laws passed by the U.S. Congress,
state legislatures and local governments and enforced by federal, state and
local agencies.  The laws impacting Alliant Energy's operations include, but
are not limited to, the Safe Drinking Water Act; Clean Water Act; CAA, as
amended by the CAA Amendments of 1990; National Environmental Policy Act;
Toxic Substances Control Act; Emergency Planning and Community Right-to-Know
Act; Resource Conservation and Recovery Act; Comprehensive Environmental
Response, Compensation and Liability Act of 1980; NWPA; Occupational Safety
and Health Act; and NEPA.  Alliant Energy regularly obtains federal, state
and local permits to assure compliance with the environmental protection laws
and regulations.  Costs associated with such compliance have increased in
recent years and are expected to increase moderately in the future.

In February 2003, WP&L's Columbia Energy Center (Columbia) received a Notice
of Violation from the Wisconsin DNR for exceeding limits in its Wisconsin
Pollutant Discharge Elimination System permit, which requires Columbia to
sample its discharge to test for acute and chronic toxicity.  In its most
recent permit, Columbia was to identify what was causing the toxicity issue
through an evaluation and develop a reduction plan.  The evaluation was
performed and Columbia developed a reduction plan that identified carbon
dioxide injection as the treatment to reduce the aluminum concentrations.
The Wisconsin DNR did not approve this method of treatment and directed
Columbia to revise the reduction plan, at which time Columbia began
evaluating a number of treatment alternatives and physical evaluation.  WP&L
has been working with the Wisconsin DNR to resolve this issue.  While it is
possible that the Wisconsin DNR may subsequently seek to impose a civil
penalty, WP&L believes it can resolve this issue to the Wisconsin DNR's
satisfaction in a manner that will not have a material adverse effect on its
financial condition or results of operations.

Refer to "Liquidity and Capital Resources - Environmental" in MD&A and Note
11(e) of the "Notes to Consolidated Financial Statements" for further
discussion of electric environmental matters.

                                       14
<PAGE>
<TABLE>
<CAPTION>
Alliant Energy Corporation

------------------------------------------------------------------------------------------------------------------------------------
Electric Operating Information (Utility Only)                    2002           2001           2000           1999           1998
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                              <C>            <C>            <C>            <C>            <C>
Operating Revenues (000s):
     Residential                                               $626,947       $599,074       $567,283       $541,714       $532,676
     Commercial                                                 376,365        373,145        349,019        329,487        317,704
     Industrial                                                 526,804        543,471        501,155        476,140        477,241
                                                         ---------------------------------------------------------------------------
       Total from ultimate customers                          1,530,116      1,515,690      1,417,457      1,347,341      1,327,621
     Sales for resale                                           160,335        184,507        173,148        155,801        199,128
     Other                                                       62,083         56,359         57,431         45,796         40,693
                                                         ---------------------------------------------------------------------------
       Total                                                 $1,752,534     $1,756,556     $1,648,036     $1,548,938     $1,567,442
                                                         ===========================================================================
------------------------------------------------------------------------------------------------------------------------------------
Electric Sales (000s MWh):
     Residential                                                  7,616          7,344          7,161          7,024          6,826
     Commercial                                                   5,542          5,464          5,364          5,260          4,943
     Industrial                                                  12,297         12,469         13,092         13,036         12,718
                                                         ---------------------------------------------------------------------------
       Total from ultimate customers                             25,455         25,277         25,617         25,320         24,487
     Sales for resale                                             4,805          4,936          4,906          5,566          7,189
     Other                                                          197            168            174            162            158
                                                         ---------------------------------------------------------------------------
       Total                                                     30,457         30,381         30,697         31,048         31,834
                                                         ===========================================================================
------------------------------------------------------------------------------------------------------------------------------------
Customers (End of Period):
     Residential                                                822,229        807,754        799,603        790,669        781,127
     Commercial                                                 128,212        125,539        123,833        122,509        121,027
     Industrial                                                   2,905          2,826          2,773          2,730          2,618
     Other                                                        3,344          3,324          3,316          3,282          3,267
                                                         ---------------------------------------------------------------------------
       Total                                                    956,690        939,443        929,525        919,190        908,039
                                                         ===========================================================================
------------------------------------------------------------------------------------------------------------------------------------
Other Selected Electric Data:
     Maximum peak hour demand (MW)                                5,729          5,677          5,397          5,233          5,228
     Sources of electric energy (000s MWh):
          Coal and gas                                           18,349         18,662         19,139         19,078         19,119
          Purchased power                                         8,596          8,727          8,058          8,619         10,033
          Nuclear                                                 5,012          4,116          4,675          4,362          4,201
          Other                                                     379            452            427            528            504
                                                         ---------------------------------------------------------------------------
            Total                                                32,336         31,957         32,299         32,587         33,857
                                                         ===========================================================================

     Revenue per KWh from ultimate customers (cents)               6.01           6.00           5.53           5.32           5.42
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                       15
<PAGE>

<TABLE>
<CAPTION>

Interstate Power and Light Company

------------------------------------------------------------------------------------------------------------------------------------
Electric Operating Information                                      2002          2001          2000           1999          1998
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                                 <C>           <C>           <C>            <C>           <C>
Operating Revenues (000s):
     Residential                                                  $355,072      $350,946      $337,615       $328,218      $333,906
     Commercial                                                    229,639       234,876       221,820        212,540       208,980
     Industrial                                                    315,494       335,680       311,070        305,022       314,470
                                                            ------------------------------------------------------------------------
       Total from ultimate customers                               900,205       921,502       870,505        845,780       857,356
     Sales for resale                                               34,513        53,320        57,433         53,050        70,592
     Other                                                          30,136        28,284        27,907         23,501        24,790
                                                            ------------------------------------------------------------------------
       Total                                                      $964,854    $1,003,106      $955,845       $922,331      $952,738
                                                            ========================================================================
------------------------------------------------------------------------------------------------------------------------------------
Electric Sales (000s MWh):
     Residential                                                     4,184         4,026         4,010          3,913         3,862
     Commercial                                                      3,392         3,342         3,333          3,280         3,045
     Industrial                                                      7,843         7,931         8,404          8,466         8,225
                                                            ------------------------------------------------------------------------
       Total from ultimate customers                                15,419        15,299        15,747         15,659        15,132
     Sales for resale                                                1,151         1,412         1,678          2,314         2,697
     Other                                                             103           107           111            108            99
                                                            ------------------------------------------------------------------------
       Total                                                        16,673        16,818        17,536         18,081        17,928
                                                            ========================================================================
------------------------------------------------------------------------------------------------------------------------------------
Customers (End of Period):
     Residential                                                   446,202       439,508       437,425        434,978       430,793
     Commercial                                                     76,856        75,132        74,483         73,813        73,170
     Industrial                                                      1,898         1,836         1,799          1,783         1,709
     Other                                                           1,328         1,359         1,393          1,389         1,407
                                                            ------------------------------------------------------------------------
       Total                                                       526,284       517,835       515,100        511,963       507,079
                                                            ========================================================================
------------------------------------------------------------------------------------------------------------------------------------
Other Selected Electric Data:
     Maximum peak hour demand (MW)                                   3,097         3,104         3,021          2,930         2,902
     Sources of electric energy (000s MWh):
          Coal and gas                                              10,219        10,343        11,065         10,892        10,203
          Purchased power                                            4,134         4,595         4,041          5,183         6,110
          Nuclear                                                    3,202         2,697         3,117          2,548         2,682
          Other                                                        127           171           179            240           216
                                                            ------------------------------------------------------------------------
            Total                                                   17,682        17,806        18,402         18,863        19,211
                                                            ========================================================================

     Revenue per KWh from ultimate customers (cents)                  5.84          6.02          5.53           5.40          5.67
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                       16
<PAGE>

<TABLE>
<CAPTION>
Wisconsin Power and Light Company

------------------------------------------------------------------------------------------------------------------------------------
Electric Operating Information                                      2002          2001          2000           1999          1998
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                                 <C>           <C>           <C>            <C>           <C>
Operating Revenues (000s):
     Residential                                                  $271,875      $248,128      $229,668       $213,496      $198,770
     Commercial                                                    146,726       138,269       127,199        116,947       108,724
     Industrial                                                    211,310       207,791       190,085        171,118       162,771
                                                            ------------------------------------------------------------------------
       Total from ultimate customers                               629,911       594,188       546,952        501,561       470,265
     Sales for resale                                              125,822       131,187       115,715        102,751       128,536
     Other                                                          31,947        28,075        29,524         22,295        15,903
                                                            ------------------------------------------------------------------------
       Total                                                      $787,680      $753,450      $692,191       $626,607      $614,704
                                                            ========================================================================

------------------------------------------------------------------------------------------------------------------------------------
Electric Sales (000s MWh):
     Residential                                                     3,432         3,318         3,151          3,111         2,964
     Commercial                                                      2,150         2,122         2,031          1,980         1,898
     Industrial                                                      4,454         4,538         4,688          4,570         4,493
                                                            ------------------------------------------------------------------------
       Total from ultimate customers                                10,036         9,978         9,870          9,661         9,355
     Sales for resale                                                3,654         3,524         3,228          3,252         4,492
     Other                                                              94            61            63             54            59
                                                            ------------------------------------------------------------------------
       Total                                                        13,784        13,563        13,161         12,967        13,906
                                                            ========================================================================

------------------------------------------------------------------------------------------------------------------------------------
Customers (End of Period):
     Residential                                                   376,027       368,246       362,178        355,691       350,334
     Commercial                                                     51,356        50,407        49,350         48,696        47,857
     Industrial                                                      1,007           990           974            947           909
     Other                                                           2,016         1,965         1,923          1,893         1,860
                                                            ------------------------------------------------------------------------
       Total                                                       430,406       421,608       414,425        407,227       400,960
                                                            ========================================================================

------------------------------------------------------------------------------------------------------------------------------------
Other Selected Electric Data:
     Maximum peak hour demand (MW)                                   2,674         2,696         2,508          2,397         2,292
     Sources of electric energy (000s MWh):
          Coal and gas                                               8,130         8,319         8,074          8,186         8,916
          Purchased power                                            4,462         4,132         4,017          3,436         3,923
          Nuclear                                                    1,810         1,419         1,558          1,814         1,519
          Other                                                        252           281           248            288           288
                                                            ------------------------------------------------------------------------
            Total                                                   14,654        14,151        13,897         13,724        14,646
                                                            ========================================================================

     Revenue per KWh from ultimate customers (cents)                  6.28          5.95          5.54           5.19          5.03
------------------------------------------------------------------------------------------------------------------------------------

</TABLE>

                                       17
<PAGE>

2)  GAS UTILITY OPERATIONS
The utilities provide gas service in Iowa, southern and central Wisconsin,
southern Minnesota and northern and northwestern Illinois.  The number of gas
customers and communities served by each utility at Dec. 31, 2002 was as
follows:

<TABLE>
<CAPTION>
                                      Transportation and
                 Retail Customers       Other Customers        Communities Served
                -------------------  ----------------------  -----------------------
<S>                      <C>                 <C>                     <C>
IP&L                    234,853              219                     253
WP&L                    170,123              254                     233
                -------------------  ----------------------  -----------------------
                        404,976              473                     486
                ===================  ======================  =======================

</TABLE>

2002 gas utility operations accounted for 18% and 18% of operating revenues
and 7% and 9% of operating income for IP&L and WP&L, respectively, which
include providing gas services to retail and transportation customers.

In providing gas commodity service to retail customers, Corporate Services
administers a diversified portfolio of transportation and storage contracts
on behalf of IP&L and WP&L.  Transportation contracts with NNG, NGPL and ANR
allow access to gas supplies located in the U.S. and Canada.  Arrangements
with Firm Citygate Supplies (FCS) provide IP&L and WP&L with gas delivered
directly to their service territories.  The maximum daily delivery capacity
of the individual utilities for 2002 was as follows (in Dths):

<TABLE>
<CAPTION>
                  NNG              NGPL                ANR                  FCS               Total
            ---------------    --------------     ---------------    -----------------    ---------------
<S>               <C>                 <C>                <C>                <C>                 <C>
IP&L            198,641             89,932             61,737             22,000              372,310
WP&L             90,056                 --            146,467             34,000              270,523

</TABLE>

IP&L and WP&L maintain purchase agreements with over 30 suppliers of natural
gas from all gas producing regions of the U.S. and Canada.  The majority of
the gas supply contracts are for terms of six months or less, with the
remaining supply contracts having terms up to two years.  The utilities' gas
supply commitments are index-based.

In addition to sales of natural gas to retail customers, IP&L and WP&L
provide transportation service to commercial and industrial customers by
moving customer-owned gas through their distribution systems to the
customers' meter.  Revenues are collected for this service pursuant to
transportation tariffs.

The gas sales of IP&L and WP&L follow a seasonal pattern.  There is an annual
base load of gas used for cooking, heating and other purposes, with a large
heating peak occurring during the winter season.  Natural gas obtained from
producers, marketers and brokers, as well as gas in storage, is utilized to
meet the peak heating season requirements.  Storage contracts allow IP&L and
WP&L to purchase gas in the summer, store the gas in underground storage
fields and deliver it in the winter.  Gas storage met approximately 20% and
16% of IP&L's and WP&L's annual gas requirements in 2002, respectively.

Refer to Note 1(j) for information relating to utility natural gas cost
recovery, Note 10(a) for information on natural gas derivatives and Note
11(b) for discussion of natural gas commitments in the "Notes to Consolidated
Financial Statements."

Gas Environmental Matters - Refer to Note 11(e) of the "Notes to Consolidated
Financial Statements" for discussion of gas environmental matters.

                                       18
<PAGE>

<TABLE>
<CAPTION>

Alliant Energy Corporation

------------------------------------------------------------------------------------------------------------------------------------
Gas Operating Information (Utility Only)                                  2002         2001         2000         1999         1998
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                                        <C>          <C>          <C>          <C>          <C>
Operating Revenues (000s):
     Residential                                                       $218,746     $270,248     $245,697     $185,090     $175,603
     Commercial                                                         111,343      141,121      127,104       89,118       85,842
     Industrial                                                          25,177       31,262       27,752       21,855       20,204
     Transportation/other                                                38,720       45,246       14,395       18,256       13,941
                                                                   -----------------------------------------------------------------
       Total                                                           $393,986     $487,877     $414,948     $314,319     $295,590
                                                                   =================================================================

------------------------------------------------------------------------------------------------------------------------------------
Gas Sales (000s Dths):
     Residential                                                         30,931       29,580       32,026       30,309       28,378
     Commercial                                                          19,348       18,055       19,696       18,349       17,760
     Industrial                                                           5,373        5,344        5,350        5,963        5,507
     Transportation/other                                                47,386       48,539       43,931       46,954       52,389
                                                                   -----------------------------------------------------------------
       Total                                                            103,038      101,518      101,003      101,575      104,034
                                                                   =================================================================

------------------------------------------------------------------------------------------------------------------------------------
Customers at End of Period (Excluding Transportation/Other):
     Residential                                                        358,384      353,430      351,990      347,533      342,586
     Commercial                                                          45,793       45,480       44,654       44,289       43,825
     Industrial                                                             799          951          953        1,037          982
                                                                   -----------------------------------------------------------------
       Total                                                            404,976      399,861      397,597      392,859      387,393
                                                                   =================================================================

------------------------------------------------------------------------------------------------------------------------------------
Other Selected Gas Data:
     Revenue per Dth sold (excluding transportation/other)                $6.38        $8.35        $7.02        $5.42        $5.45
     Purchased gas costs per Dth sold (excluding transportation/other)    $4.02        $6.31        $4.88        $3.30        $3.22
------------------------------------------------------------------------------------------------------------------------------------

</TABLE>

                                       19
<PAGE>

<TABLE>
<CAPTION>
Interstate Power and Light Company

------------------------------------------------------------------------------------------------------------------------------------
Gas Operating Information                                               2002         2001          2000         1999         1998
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                                     <C>           <C>          <C>          <C>          <C>
Operating Revenues (000s):
     Residential                                                      $124,237      $162,575     $149,493     $115,428     $110,430
     Commercial                                                         61,222        82,463       72,592       53,548       51,944
     Industrial                                                         18,197        22,355       19,171       15,778       14,308
     Transportation/other                                               11,239        13,621        8,540        8,795        7,171
                                                                  ------------------------------------------------------------------
       Total                                                          $214,895      $281,014     $249,796     $193,549     $183,853
                                                                  ==================================================================
------------------------------------------------------------------------------------------------------------------------------------
Gas Sales (000s Dths):
     Residential                                                        18,068        17,826       19,257       18,239       17,442
     Commercial                                                         10,774        10,483       11,101       10,578       10,475
     Industrial                                                          4,070         4,147        3,874        4,443        4,085
     Transportation/other                                               28,814        31,673       30,251       33,717       39,441
                                                                  ------------------------------------------------------------------
       Total                                                            61,726        64,129       64,483       66,977       71,443
                                                                  ==================================================================
------------------------------------------------------------------------------------------------------------------------------------
Customers at End of Period (Excluding Transportation/Other):
     Residential                                                       206,808       205,065      205,300      203,518      201,521
     Commercial                                                         27,607        27,649       27,071       26,909       26,767
     Industrial                                                            438           441          440          461          476
                                                                  ------------------------------------------------------------------
       Total                                                           234,853       233,155      232,811      230,888      228,764
                                                                  ==================================================================
------------------------------------------------------------------------------------------------------------------------------------
Other Selected Gas Data:
     Revenue per Dth sold (excluding transportation/other)               $6.19         $8.24        $7.05        $5.55        $5.52
     Purchased gas cost per Dth sold (excluding transportation/other)    $4.11         $6.20        $4.89        $3.41        $3.20
------------------------------------------------------------------------------------------------------------------------------------

Wisconsin Power and Light Company

------------------------------------------------------------------------------------------------------------------------------------
Gas Operating Information                                               2002         2001          2000         1999         1998
------------------------------------------------------------------------------------------------------------------------------------
Operating Revenues (000s):
     Residential                                                       $94,509      $107,673      $96,204      $69,662      $65,173
     Commercial                                                         50,121        58,658       54,512       35,570       33,898
     Industrial                                                          6,980         8,907        8,581        6,077        5,896
     Transportation/other                                               27,481        31,625        5,855        9,461        6,770
                                                                  ------------------------------------------------------------------
       Total                                                          $179,091      $206,863     $165,152     $120,770     $111,737
                                                                  ==================================================================
------------------------------------------------------------------------------------------------------------------------------------
Gas Sales (000s Dths):
     Residential                                                        12,863        11,754       12,769       12,070       10,936
     Commercial                                                          8,574         7,572        8,595        7,771        7,285
     Industrial                                                          1,303         1,197        1,476        1,520        1,422
     Transportation/other                                               18,572        16,866       13,680       13,237       12,948
                                                                  ------------------------------------------------------------------
       Total                                                            41,312        37,389       36,520       34,598       32,591
                                                                  ==================================================================
------------------------------------------------------------------------------------------------------------------------------------
Customers at End of Period (Excluding Transportation/Other):
     Residential                                                       151,576       148,365      146,690      144,015      141,065
     Commercial                                                         18,186        17,831       17,583       17,380       17,058
     Industrial                                                            361           510          513          576          506
                                                                  ------------------------------------------------------------------
       Total                                                           170,123       166,706      164,786      161,971      158,629
                                                                  ==================================================================
------------------------------------------------------------------------------------------------------------------------------------
Other Selected Gas Data:
     Revenue per Dth sold (excluding transportation/other)               $6.67         $8.54        $6.97        $5.21        $5.34
     Purchased gas cost per Dth sold (excluding transportation/other)    $3.89         $6.47        $4.69        $3.00        $3.13
------------------------------------------------------------------------------------------------------------------------------------

</TABLE>

                                       20
<PAGE>

D.    INFORMATION RELATING TO NON-REGULATED OPERATIONS
Resources manages a portfolio of wholly-owned subsidiaries and additional
investments through distinct platforms: International, Non-regulated
Generation, Integrated Services, Investments and Energy Technologies.  In
November 2002, Alliant Energy announced its commitment to pursue the sale of,
or other exit strategies for, Whiting, its investments in Australia and its
affordable housing business.  Refer to Note 16 in Alliant Energy's "Notes to
Consolidated Financial Statements" for additional information.  Resources
intends to focus on its International and Non-regulated Generation businesses
as its primary long-term strategic platforms and will continue reviewing for
ways to narrow its strategic focus and business platforms.

International - has invested in energy generation and distribution companies
and projects in select growing markets.  Currently, International has
investments in Brazil, China and New Zealand and a loan to a development
project in Mexico.  International has focused on these locations because of
its belief that they offer a growing demand for energy and are receptive to
foreign investment.  International also has developed partnerships with other
entities that have intimate knowledge of each local market's business trends
and customs.  In addition, Alliant Energy has investments in Australia that
it is in the process of selling.  Refer to Note 9 of Alliant Energy's "Notes
to Consolidated Financial Statements" for additional information related to
Alliant Energy's investments in foreign entities.

Non-regulated Generation - Alliant Energy Generation, Inc., was formed to
build a portfolio of competitive generating assets across the U.S., focusing
primarily on the Upper Midwest.  Alliant Energy expects to build this
portfolio through a combination of strategic acquisitions, partnerships and
development projects.  Given the status of the current non-regulated
generation market, Alliant Energy's initial investments in this market will
focus on facilities with underlying long-term purchased-power agreements.
While Alliant Energy believes there are strong acquisition opportunities in
the existing non-regulated generation market, it will continue to be patient,
prudent and diligent in its pursuit of such opportunities.  Synfuel has an
equity interest in a synthetic fuel processing facility.  The synthetic fuel
project generates operating losses at its fuel processing facility, which are
more than offset by tax credits and the tax benefit of the losses generated.
Refer to "Liquidity and Capital Resources - Construction and Acquisition
Expenditures" in MD&A for additional information including an announcement in
February 2003 regarding the purchase of a generation facility.

Integrated Services - provides a wide range of energy and environmental
services for commercial, industrial, institutional, educational and
governmental customers.  It offers large energy users an array of services to
maximize customers' productivity, profitability and energy efficiency, and
provides solutions for waste remediation and other environmental engineering
and consulting services.  Integrated Services includes:  Cogenex Corporation
(Cogenex), Industrial Energy Applications, Inc. (IEA), Heartland Energy
Group, Inc. (HEG), RMT, Inc. (RMT) and Alliant Energy Integrated Services
Company - Energy Solutions L.L.C. (Energy Solutions).  Cogenex and IEA
provide business customers with on-site energy services.  HEG offers
commodities-based energy services primarily related to supplying natural gas
and owns several natural gas and oil gathering systems in Texas.  RMT is an
environmental and engineering consulting company that serves clients
nationwide in a variety of industrial market segments and specializes in
consulting on solid and hazardous waste management, ground water quality
protection, industrial design and hygiene engineering, and air and water
pollution control.  RMT is marketing SmartBurn, which is a large-scale
emissions-reducing program for coal-burning facilities, to other U.S.
companies.  Energy Solutions provides energy consulting services to
commercial, industrial and institutional customers.

Investments - subsidiaries and investments include Transportation and
Investments.  Transportation is a holding company whose wholly-owned
subsidiaries include the Cedar Rapids and Iowa City Railway Company
(CRANDIC), which is a short-line railway that provides freight service
between Cedar Rapids and Iowa City; IEI Barge Services, Inc. (Barge), which
provides barge terminal and hauling services on the Mississippi River; and
Williams Bulk Transfer Inc. (Williams) and Transfer Services, Inc.
(Transfer), which provide transfer and storage services.  Investments is a
holding company whose primary wholly-owned subsidiary includes Iowa Land and
Building Company (Iowa Land) which is organized to pursue real estate and
economic development activities in IP&L's service territory.  Investments
also has direct and indirect equity interests in various small real estate
and economic development ventures, primarily concentrated in Cedar Rapids,
Iowa, and holds other passive investments, including an equity interest in
McLeod, an integrated telecommunications and services provider.  Alliant
Energy is in the process of selling Whiting and its affordable housing
business.

                                       21
<PAGE>

Energy Technologies - Resources has invested in energy technologies by
purchasing equity interests in Capstone, a microturbine producer; Nth Power
Technologies Fund II, LP, a venture capital fund specializing in emerging
energy-technology companies; and several other modest investments in emerging
energy technology businesses.  These ventures allow Alliant Energy to provide
its customers with new technologies that are smaller in scale than more
traditional generation technologies, such as microturbines, fuel cells, solar
concepts and wind turbines.

Mass Marketing has held interests in energy marketing businesses. In January
2003, Alliant Energy committed to a plan to sell SmartEnergy, an
internet-based retailer, and Alliant Energy is in the process of disbanding
its Mass Marketing business unit.

E.    DISCLOSURE CONCERNING WEBSITE ACCESS TO REPORTS
Alliant Energy makes its periodic and current reports, and amendments to
those reports, available, free of charge, on its website at
www.alliantenergy.com/investors on the same day as such material is
electronically filed with, or furnished to, the SEC.  Alliant Energy is not
including the information contained on its website as a part of, or
incorporating it by reference into, this Annual Report on Form 10-K.

                                       22
<PAGE>

ITEM 2.  PROPERTIES

IP&L
IP&L's  principal  electric  generating  stations  at Dec.  31,  2002,  were as
follows:

<TABLE>
<CAPTION>
                        Name and Location                               Primary Fuel             2002 Summer Capability
                           of Station                                       Type                         in KWs
------------------------------------------------------------------     ---------------    --------------------------------------

   <S>                                                                    <C>                    <C>                <C>
   Duane Arnold Energy Center, Palo, IA                                Nuclear                                   393,050  (1)

   Ottumwa Generating Station, Ottumwa, IA                             Coal                    345,690(2)
   Prairie Creek Station, Cedar Rapids, IA                             Coal                    194,560
   Sutherland Station, Marshalltown, IA                                Coal                    142,700
   Sixth Street Station, Cedar Rapids, IA                              Coal                     49,510
   Burlington Generating Station, Burlington, IA                       Coal                    215,060
   George Neal Unit 3, Sioux City, IA                                  Coal                    144,200(3)
   George Neal Unit 4, Sioux City, IA                                  Coal                    138,640(4)
   Dubuque Units 2, 3 and 4, Dubuque, IA                               Coal                     77,070
   M. L. Kapp Plant Units 1 and 2, Clinton, IA                         Coal                    238,300
   Lansing Units 1, 2, 3 and 4, Lansing, IA                            Coal                    317,130
   Louisa Unit 1, Louisa, IA                                           Coal                     28,000(5)
                                                                                              -----------
          Total Coal                                                                                           1,890,860

   Marshalltown Combustion Turbines, Marshalltown, IA                  Oil                     167,500
   Centerville Combustion Turbines, Centerville, IA                    Oil                      53,660
   Montgomery Combustion Turbine Unit 1, Montgomery, MN                Oil                      20,210
   Fox Lake Plant Combustion Turbine Unit 4, Sherburn, MN              Oil                      20,070
   Lime Creek Plant Combustion Turbine Units 1 and 2,
      Mason City, IA                                                   Oil                      72,960
   Diesel Stations, in IA/MN                                           Oil                      18,350
                                                                                              -----------
          Total Oil                                                                                              352,750

   Grinnell Station, Grinnell, IA                                      Gas                      25,630
   Agency Street Combustion Turbines, West Burlington, IA              Gas                      66,990
   Burlington Combustion Turbines, Burlington, IA                      Gas                      66,730
   Red Cedar Combustion Turbine, Cedar Rapids, IA                      Gas                      17,380
   Fox Lake Plant Units 1, 2 and 3, Sherburn, MN                       Gas                     106,870
                                                                                              -----------
          Total Gas                                                                                              283,600
                                                                                                             ------------

          Total generating capability                                                                          2,920,260
                                                                                                             ============
</TABLE>

All KWs shown below represent the 2002 summer generating capability.

  (1) Represents IP&L's 70% ownership interest in this 561,500 KW generating
      station, which is operated by IP&L.
  (2) Represents IP&L's 48% ownership interest in this 720,190 KW generating
      station, which is operated by IP&L.
  (3) Represents IP&L's 28% ownership interest in this 515,000 KW generating
      station, which is operated by MidAmerican Energy Company.
  (4) Represents IP&L's 21.5% ownership interest in this 644,000 KW generating
      station, which is operated by MidAmerican Energy Company.
  (5) Represents IP&L's 4% ownership interest in this 700,000 KW generating
      station, which is operated by MidAmerican Energy Company.

IP&L owns 7,068 miles of electric transmission lines and 801 substations,
substantially all located in Iowa, Minnesota and Illinois.  IP&L's principal
properties are suitable for their intended use and are held subject to the
liens of indentures relating to its bonds.

                                       23
<PAGE>

WP&L
WP&L's principal electric generating stations at Dec. 31, 2002, were as
follows:

<TABLE>
<CAPTION>
                    Name and Location                          Primary Fuel              2002 Summer Capability
                        of Station                                 Type                          in KWs
-----------------------------------------------------------   ---------------     --------------------------------------

    <S>                                                         <C>                     <C>                <C>
    Kewaunee Nuclear Power Plant, Kewaunee, WI                Nuclear                                    217,300   (1)

    Nelson Dewey Generating Station, Cassville, WI            Coal                     222,460
    Edgewater Generating Station #3, Sheboygan, WI            Coal                      76,000
    Edgewater Generating Station #4, Sheboygan, WI            Coal                     230,520  (2)
    Edgewater Generating Station #5, Sheboygan, WI            Coal                     314,340  (3)
    Columbia Energy Center, Portage, WI                       Coal                     502,130  (4)
                                                                                  -------------
          Total Coal                                                                                   1,345,450

    Blackhawk Generating Station, Beloit, WI                  Gas                       54,500
    Rock River Generating Station, Beloit, WI                 Gas                      147,830
    Rock River Combustion Turbine, Beloit, WI                 Gas                      150,330
    South Fond du Lac Combustion Turbine
        Units 2 and 3, Fond du Lac, WI                        Gas                      167,670
    Sheepskin Combustion Turbine, Edgerton, WI                Gas                       37,920
                                                                                  -------------
          Total Gas                                                                                      558,250

    Kilbourn Hydro Plant, Wisconsin Dells, WI                 Hydro                      7,000
    Prairie du Sac Hydro Plant, Prairie du Sac, WI            Hydro                     15,000
    Petenwell/Castle Rock Hydro Plants,
        Wisconsin Rapids, WI                                  Hydro                      6,000  (5)
                                                                                  -------------
          Total Hydro                                                                                     28,000
                                                                                                     -------------

          Total generating capability                                                                  2,149,000
                                                                                                     =============
</TABLE>

All KWs shown below represent the 2002 summer generating capability.

(1)  Represents WP&L's 41% ownership interest in this 530,000 KW
     generating station, which is operated by WPSC.
(2)  Represents WP&L's 68.2% ownership interest in this 338,000 KW generating
     station, which is operated by WP&L.
(3)  Represents WP&L's 75% ownership interest in this 419,120 KW generating
     station, which is operated by WP&L.
(4)  Represents WP&L's 46.2% ownership interest in this 1,086,860 KW
     generating station, which is operated by WP&L.
(5)  WP&L has a 50% ownership interest in this 18,000 KW hydro plant, which
     is operated by Wisconsin River Power Company, but has a contract to
     purchase only one-third of the plant's  output.

WP&L owns 158 distribution substations located adjacent to the communities
served, substantially all located in Wisconsin.  WP&L's transmission assets
were transferred to ATC in 2001.  Substantially all of WP&L's facilities are
suitable for their intended use and are held subject to the lien of its First
Mortgage Bond indenture.  Refer to "C. Information Relating to Domestic
Utility Operations - 1) Electric Utility Operations - General" in "Business"
for information related to WP&L's investment in ATC.

                                       24
<PAGE>

Resources
Resources' principal properties at Dec. 31, 2002 were as follows:

1.    International - owns nine combined heat and power facilities located in
      China with an aggregate generating capacity of approximately 475 MW.
2.    Non-regulated Generation - turbines and related generation equipment for
      use in future generation projects.
3.    Integrated Services - standby generation, cogeneration, steam production
      and propane air systems and owns an interest in an oil gathering system
      and natural gas gathering systems, which had 500 miles and 213 miles,
      respectively, of pipeline in Texas.
4.    Investments - CRANDIC has 112 railroad track miles all located within
      Iowa.

ITEM 3.  LEGAL PROCEEDINGS

Alliant Energy
In October 2000, Alliant Energy and WP&L filed a federal lawsuit seeking
declaratory relief regarding whether certain provisions of WUHCA are
unconstitutional as a violation of the interstate commerce and equal protection
provisions of the U.S. Constitution.  Alliant Energy and WP&L are challenging
the provisions of WUHCA which restrict ownership in utility holding companies,
limit the investments those companies can make and place significant
restrictions on companies that invest in Wisconsin utility holding companies.
Alliant Energy and WP&L also requested that the court consider the
constitutionality of issues related to the asset cap on non-utility investments
imposed by WUHCA.  Alliant Energy and WP&L were seeking only declaratory relief
and not damages in the litigation.  In February 2001, the lawsuit was dismissed
based on lack of allegations of "injury in fact."  Alliant Energy and WP&L
filed a motion for reconsideration with the court, which was denied in April
2001. Alliant Energy and WP&L appealed the lower court's rulings to the 7th
Circuit Court of Appeals.  In January 2002, the 7th Circuit reversed the
district court's decision and remanded the case back to the district court for
hearing.  In May 2002, the district judge granted the state's motion for
summary judgment and dismissed Alliant Energy's and WP&L's case.  Alliant
Energy and WP&L appealed the district court's decision to the 7th Circuit Court
of Appeals in June 2002.  Briefing of the appeal has been completed, with a
decision expected in the second quarter of 2003.  Alliant Energy and WP&L
cannot currently predict the outcome of this litigation.

Alliant Energy received an adverse ruling in 1999 from a U.S. district court
dealing with an income tax refund claim Alliant Energy filed relating to
capital losses disallowed under audit by the IRS.  The district court also
disallowed certain related deductions allowed by the IRS to reduce a tax
refund due to Alliant Energy related to another tax issue.  Alliant Energy
appealed the district court's ruling and the government appealed the decision
which led to the tax refund due to Alliant Energy.  In June 2001, the U.S.
Court of Appeals for the 8th Circuit ruled in Alliant Energy's favor with
respect to both tax issues.  In July 2001, the government filed a petition
for rehearing with the U.S. Court of Appeals related to the capital losses
allowed in the 8th Circuit opinion.  The 8th Circuit denied the appeal in
September 2001 and remanded the case back to the district court for entry of
judgment.  The federal government decided not to pursue the ruling in favor
of Alliant Energy of the U.S. Court of Appeals for the 8th Circuit with
respect to these two tax issues.  As a result, Alliant Energy recorded the
applicable tax benefit and interest income in the fourth quarter of 2001
related to these events.  An additional potential refund of approximately $14
million, plus interest, was also being contested by the government.  However,
the district court ruled in favor of the federal government in July 2002 on
such issue.  Alliant Energy has appealed the most recent district court
decision.  An adverse decision on appeal would not result in Alliant Energy
recording any charges to earnings as the potential refund simply represents a
gain contingency.  Subsequently, the government filed a cross appeal, which
it later decided not to pursue and voluntarily moved for its dismissal.
Alliant Energy is awaiting a decision from the 8th Circuit Court of Appeals.

IP&L
IP&L has appealed to the Iowa State Board of Tax Review, an agency of the
State of Iowa, regarding assessments of Iowa property tax made by the
Director of the Iowa Department of Revenue and Finance.  The appeals involve
assessments for the years 1994 through 1998 and seek reduction of the
assessments reflecting the true value of the operating property of the
companies.  At the present time, IP&L cannot predict what impact, if any, the
appeals process will have on its financial condition or results of
operations.

                                       25
<PAGE>

WP&L - None

Environmental Matters
The information required by Item 3 with regards to environmental matters is
included in "C. Information Relating to Domestic Utility Operations - 1)
Electric Utility Operations" in "Business," "Liquidity and Capital Resources
- Environmental" in MD&A and Note 11(e) of the "Notes to Consolidated
Financial Statements," which information is incorporated herein by reference.

Rate Matters
The information required by Item 3 with regards to rate matters is included
in Note 2 of Alliant Energy's "Notes to Consolidated Financial Statements"
and "Rates and Regulatory Matters" in MD&A, which information is incorporated
herein by reference.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

IP&L
At IP&L's annual meeting of shareowners held on Oct. 9, 2002, Alan B. Arends,
Katharine C. Lyall, Singleton B. McAllister and Anthony R. Weiler were
elected as directors of IP&L for terms expiring in 2005.  Alliant Energy
voted all of the outstanding shares of common stock of IP&L (consisting of
13,370,788 shares) in favor of the election of these individuals.  The
following are the other directors of IP&L whose terms of office continued
after the 2002 annual meeting:  Erroll B. Davis, Jr., Lee Liu, Robert W.
Schlutz and Wayne H. Stoppelmoor, with terms expiring in 2003; and Jack B.
Evans, Joyce L. Hanes, David A. Perdue and Judith D. Pyle, with terms
expiring in 2004.

EXECUTIVE OFFICERS OF THE REGISTRANTS
-------------------------------------
The executive officers of Alliant Energy, IP&L and WP&L as of the date of
this filing are as follows (figures following the names represent the
officer's age as of Dec. 31, 2002):

Executive Officers of Alliant Energy
Erroll B. Davis, Jr., 58, was elected Chairman of the Board effective April
---------------
2000, has served as President and Chief Executive Officer (CEO) since 1990
and has been a board member since 1988.
William D. Harvey, 53, was elected Executive Vice President (EVP)-Generation
-----------------
effective April 1998.
James E. Hoffman, 49, was elected EVP-Business Development effective April
----------------
1998.
Eliot G. Protsch, 49, was elected EVP-Energy Delivery effective April 1998.
----------------
Barbara J. Swan, 51, was elected EVP and General Counsel effective October
---------------
1998.  She previously served as Vice President (VP)-General Counsel from 1994
to 1998 at WP&L.
Thomas M. Walker, 55, was elected EVP and Chief Financial Officer (CFO)
----------------
effective April 1998.
Pamela J. Wegner, 55, was elected EVP-Shared Solutions effective October
----------------
1998.  She previously served as VP-Information Services and Administration
from 1994 to 1998 at WP&L.
Dundeana K. Doyle, 44, was elected VP-Infrastructure Security effective
-----------------
January 2002.  She previously served as VP-Customer Operations since December
2000 at IESU and WP&L, VP-Customer Services and Operations from 1999 to 2000
at IESU and WP&L, VP-Customer Operations from 1998 to 1999 at IESU and
VP-Customer Services from 1998 to 1999 at WP&L.
Thomas L. Hanson, 49, was elected VP and Treasurer effective April 2002.  He
----------------
previously served as Managing Director-Generation Services since 2001 and
General Manager-Business and Financial Performance, Generation from 1998 to
2001.
John E. Kratchmer, 40, was elected VP-Controller and Chief Accounting Officer
-----------------
effective October 2002.  He previously served as Corporate Controller and
Chief Accounting Officer since October 2000 and Assistant Controller from
1998 to 2000.
Barbara A. Siehr, 51, was elected VP-Financial Planning and Strategic
----------------
Projects effective October 2002.  She previously served as Managing
Director-Operations and Operations Services since December 2000, General
Manager-Operations East from 1999 to 2000 and General
Manager-Engineering/Operations Services from 1998 to 1999.

                                       26
<PAGE>
F. J. Buri, 48, was elected Corporate Secretary effective April 2002.  He
----------
previously served as Senior Attorney since June 1999.  Prior to joining
Alliant Energy, he was General Counsel and Secretary from 1996 to 1999 at
Universal Savings Bank, N.A.

None of the executive officers listed above is related to any member of the
Board of Directors or nominee for director or any other executive officer.
Mr. Davis has an employment agreement with Alliant Energy pursuant to which
his term of office is established.  All other executive officers have no
definite terms of office and serve at the pleasure of the Board of Directors.

Additional Officers of Alliant Energy
Enrique Bacalao, 53, was elected Assistant Treasurer effective November
---------------
1998.  Prior to joining Alliant Energy, he was VP, Corporate Banking from
1995 to 1998 at the Chicago Branch of The Industrial Bank of Japan, Limited.
Eric D. Mott, 35, was elected Assistant Treasurer effective December 2001.
------------
He previously served as Manager-Investor Relations and Trust Fund Investment
Management since December 2000 and Senior Treasury Analyst from 1998 to 2000.
Joan M. Thompson, 45, was elected Assistant Controller effective June 2000.
----------------
She previously served as Manager-IESU and IPC Accounting since February 1999
and Manager-IESU Accounting from 1998 to 1999.
Patricia L. Reininger, 50, was elected Assistant Corporate Secretary
---------------------
effective January 2003.  She previously served as Executive Administrative
Assistant since August 2000.  Prior to joining Alliant Energy, she was
Assistant to the Chairperson and Assistant Corporate Secretary from 1993 to
1999 at Sentry Insurance.

Executive Officers of IP&L
Erroll B. Davis, Jr., 58, was elected Chairman of the Board effective April
---------------
2000 and CEO effective April 1998.  Mr. Davis is also an officer of Alliant
Energy and WP&L.
Eliot G. Protsch, 49, was elected President effective April 1998.  Mr.
----------------
Protsch is also an officer of Alliant Energy and WP&L.
William D. Harvey, 53, was elected EVP-Generation effective October 1998.
-----------------
Mr. Harvey is also an officer of Alliant Energy and WP&L.
Barbara J. Swan, 51, was elected EVP and General Counsel effective October
---------------
1998.  Ms. Swan is also an officer of Alliant Energy and WP&L.
Thomas M. Walker, 55, was elected EVP and CFO in 1996.  Mr. Walker is also an
----------------
officer of Alliant Energy and WP&L.
Pamela J. Wegner, 55, was elected EVP-Shared Solutions effective October
----------------
1998.  Ms. Wegner is also an officer of Alliant Energy and WP&L.
Dundeana K. Doyle, 44, was elected VP-Infrastructure Security effective
-----------------
January 2002.  Ms. Doyle is also an officer of Alliant Energy and WP&L.
Vern A. Gebhart, 49, was elected VP-Customer Operations effective January
---------------
2002.  He previously served as Managing Director-Strategic Projects and
Capital Control since 2000 and Director-Strategic Projects and Capital
Control from 1998 to 2000 at Alliant Energy.  Mr. Gebhart is also an officer
of WP&L.
Thomas L. Hanson, 49, was elected VP and Treasurer effective April 2002.  Mr.
----------------
Hanson is also an officer of Alliant Energy and WP&L.
John E. Kratchmer, 40, was elected VP-Controller and Chief Accounting Officer
-----------------
effective October 2002.  Mr. Kratchmer is also an officer of Alliant Energy
and WP&L.
Daniel L. Mineck, 54, was elected VP-Performance Engineering and
----------------
Environmental effective October 1998.  He previously served as Assistant
VP-Corporate Engineering since 1996.  Mr. Mineck is also an officer of WP&L.
Barbara A. Siehr, 51, was elected VP-Financial Planning and Strategic
----------------
Projects effective October 2002.  Ms. Siehr is also an officer of Alliant
Energy and WP&L.
Kim K. Zuhlke, 49, was elected VP-Engineering, Sales and Marketing effective
-------------
September 1999.  He previously served as VP-Customer Operations since October
1998.  Mr. Zuhlke is also an officer of WP&L.
F. J. Buri, 48, was elected Corporate Secretary effective April 2002.  Mr.
----------
Buri is also an officer of Alliant Energy and WP&L.

None of the executive officers listed above is related to any member of the
Board of Directors or nominee for director or any other executive officer.
Mr. Davis has an employment agreement with Alliant Energy pursuant to which
                                       27
<PAGE>
his term of office is established.  All other executive officers have no
definite terms of office and serve at the pleasure of the Board of Directors.

Additional Officers of IP&L
Enrique Bacalao, 53, was elected Assistant Treasurer effective November 1998.
---------------
Mr. Bacalao is also an officer of Alliant Energy and WP&L.
Steven F. Price, 50, was elected Assistant Treasurer effective April 1998.
---------------
Mr. Price is also an officer of WP&L.
Patricia L. Reininger, 50, was elected Assistant Corporate Secretary
---------------------
effective January 2003.  Ms. Reininger is also an officer of Alliant Energy
and WP&L.
Daniel L. Siegfried, 43, was elected Assistant Corporate Secretary effective
-------------------
April 1998.  He also serves as Senior Attorney for Alliant Energy.

Executive Officers of WP&L
Erroll B. Davis, Jr., 58, was elected Chairman of the Board effective April
--------------------
2000 and CEO effective April 1998.    Mr. Davis is also an officer of Alliant
Energy and IP&L.
William D. Harvey, 53, was elected President effective April 1998.  Mr.
-----------------
Harvey is also an officer of Alliant Energy and IP&L.
Eliot G. Protsch, 49, was elected EVP-Energy Delivery effective October
----------------
1998.  He previously served as Senior VP from 1993 to 1998 at WP&L.  Mr.
Protsch is also an officer of Alliant Energy and IP&L.
Barbara J. Swan, 51, was elected EVP and General Counsel effective October
---------------
1998.  She previously served as VP-General Counsel from 1994 to 1998 at
WP&L.  Ms. Swan is also an officer of Alliant Energy and IP&L.
Thomas M. Walker, 55, was elected EVP and CFO effective October 1998.  Mr.
----------------
Walker is also an officer of Alliant Energy and IP&L.
Pamela J. Wegner, 55, was elected EVP-Shared Solutions effective October
----------------
1998.  She previously served as VP-Information Services and Administration
from 1994 to 1998 at WP&L.  Ms. Wegner is also an officer of Alliant Energy
and IP&L.
Dundeana K. Doyle, 44, was elected VP-Infrastructure Security effective
-----------------
January 2002.  Ms. Doyle is also an officer of Alliant Energy and IP&L.
Vern A. Gebhart, 49, was elected VP-Customer Operations effective January
---------------
2002.  Mr. Gebhart is also an officer of IP&L.
Thomas L. Hanson, 49, was elected VP and Treasurer effective April 2002.  Mr.
----------------
Hanson is also an officer of Alliant Energy and IP&L.
John E. Kratchmer, 40, was elected VP-Controller and Chief Accounting Officer
-----------------
effective October 2002.  Mr. Kratchmer is also an officer of Alliant Energy
and IP&L.
Daniel L. Mineck, 54, was elected VP-Performance Engineering and
----------------
Environmental effective April 1998.  Mr. Mineck is also an officer of IP&L.
Barbara A. Siehr, 51, was elected VP-Financial Planning and Strategic
----------------
Projects effective October 2002.  Ms. Siehr is also an officer of Alliant
Energy and IP&L.
Kim K. Zuhlke, 49, was elected VP-Engineering, Sales & Marketing effective
-------------
September 1999.  He previously served as VP-Customer Operations since April
1998 at WP&L and since October 1998 at IESU and as VP-Customer Services and
Sales from 1993 to 1998 at WP&L.  Mr. Zuhlke is also an officer of IP&L.
F. J. Buri, 48, was elected Corporate Secretary effective April 2002.  Mr.
----------
Buri is also an officer of Alliant Energy and IP&L.

None of the executive officers listed above is related to any member of the
Board of Directors or nominee for director or any other executive officer.
Mr. Davis has an employment agreement with Alliant Energy pursuant to which
his term of office is established.  All other executive officers have no
definite terms of office and serve at the pleasure of the Board of Directors.

Additional Officers of WP&L
Enrique Bacalao, 53, was elected Assistant Treasurer effective November
---------------
1998.  Mr. Bacalao is also an officer of Alliant Energy and IP&L.
Steven F. Price, 50, was elected Assistant Treasurer effective April 1998.
---------------
Mr. Price is also an officer of IP&L.
Patricia L. Reininger, 50, was elected Assistant Corporate Secretary
---------------------
effective January 2003.  Ms. Reininger is also an officer of Alliant Energy
and IP&L.
                                       28
<PAGE>
                                    PART II

ITEM 5.  MARKET FOR REGISTRANTS' COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Alliant Energy's common stock trades on the New York Stock Exchange under the
symbol "LNT."  Quarterly sales price ranges and dividends with respect to
Alliant Energy's common stock were as follows:

<TABLE>
<CAPTION>
                                 2002                                         2001
               -----------------------------------------     ---------------------------------------
 Quarter          High           Low         Dividend          High           Low         Dividend
 -------          ----           ---         --------          ----           ---         --------
 <S>               <C>           <C>            <C>             <C>           <C>            <C>
 First            $31.01        $28.67         $0.50           $33.20        $28.75         $0.50
 Second            30.85         24.75          0.50            32.67         28.20          0.50
 Third             25.77         16.35          0.50            31.49         27.90          0.50
 Fourth            19.89         14.28          0.50            32.29         27.50          0.50
   Year            31.01         14.28          2.00            33.20         27.50          2.00

</TABLE>

Stock closing price at Dec. 31, 2002:  $16.55

Although Alliant Energy's practice has been to pay cash dividends on its
common stock quarterly, the timing of payment and amount of future dividends
are necessarily dependent upon future earnings, capital requirements, general
financial condition, general business conditions, the ability of Alliant
Energy's subsidiaries to pay dividends and other factors.  Effective with the
dividend declared and paid in the first quarter of 2003, Alliant Energy
reduced its targeted annual common stock dividend from $2.00 to $1.00 per
share.

At Dec. 31, 2002, there were approximately 55,470 holders of record of
Alliant Energy's stock, including holders in Alliant Energy's Shareowner
Direct Plan.

Alliant Energy is the sole common shareowner of all 13,370,788 shares of IP&L
common stock currently outstanding.  During 2002 and 2001, IP&L paid dividends
on its common stock of $82 million and $80 million, respectively, to its
parent.  Under certain circumstances, IP&L has the right under terms of its
subordinated deferrable interest debentures to extend interest payments for
periods not to exceed 20 consecutive quarters.  It is IP&L's current intent not
to exercise such right.  In the event IP&L did exercise this right, it would
limit IP&L's ability to pay dividends, among other things.

Alliant Energy is the sole common shareowner of all 13,236,601 shares of WP&L
common stock currently outstanding.  During both 2002 and 2001, WP&L paid
dividends on its common stock of $60 million to its parent.  WP&L's dividends
are restricted to the extent that such dividend would reduce the common stock
equity ratio to less than 25%.  The PSCW has ordered that it must approve the
payment of dividends by WP&L to Alliant Energy that are in excess of the
level forecasted in the rate order ($62 million), if such dividends would
reduce WP&L's average common equity ratio below 44.67% of total
capitalization.  The dividends paid by WP&L to Alliant Energy since the rate
order was issued have not exceeded such level.  IP&L and WP&L each have
common stock dividend payment restrictions based on their respective bond
indentures and the terms of their preferred stock.

                                       29
<PAGE>

<TABLE>
<CAPTION>

ITEM 6.  SELECTED FINANCIAL DATA

Alliant Energy Corporation

------------------------------------------------------------------------------------------------------------------------------------
Financial Information                                                2002 (1)      2001 (1)      2000 (1)      1999 (2)     1998 (3)
------------------------------------------------------------------------------------------------------------------------------------
                                                                            (dollars in thousands, except per share data)
<S>                                                                     <C>          <C>           <C>          <C>          <C>
Income Statement Data:
   Operating revenues                                               $2,608,812   $2,624,676    $2,279,674   $2,048,158   $2,053,318
   Income from continuing operations                                    76,269      126,245       330,915      154,334       95,437
   Income from discontinued operations, net of tax                      30,612       58,985        51,039       42,247        1,238
   Income before cumulative effect of changes in accounting
      principle, net of tax                                            106,881      185,230       381,954      196,581       96,675
   Cumulative effect of changes in accounting principle, net of tax         --      (12,868)       16,708          --           --
   Net income                                                          106,881      172,362       398,662      196,581       96,675
------------------------------------------------------------------------------------------------------------------------------------
Common Stock Data:
   Earnings per average common share (diluted):
        Income from continuing operations                                $0.84        $1.57         $4.18        $1.98        $1.24
        Income from discontinued operations                              $0.34        $0.73         $0.64        $0.53        $0.02
        Cumulative effect of changes in accounting principle                --       ($0.16)        $0.21          --           --
        Net income                                                       $1.18        $2.14         $5.03        $2.51        $1.26
   Common shares outstanding at year-end (000s)                         92,304       89,682        79,010       78,984       77,630
   Dividends declared per common share                                   $2.00        $2.00         $2.00        $2.00        $2.00
   Market value per share at year-end                                   $16.55       $30.36        $31.88       $27.50       $32.25
   Book value per share at year-end (4)                                 $19.89       $21.39        $25.79       $27.29       $20.69
------------------------------------------------------------------------------------------------------------------------------------
Other Selected Financial Data:
   Construction and acquisition expenditures                          $656,792     $713,061      $845,454     $418,371     $313,033
   Total assets at year-end (4)                                     $7,001,395   $6,237,925    $6,733,766   $6,075,683   $4,959,337
   Long-term obligations, net                                       $2,784,216   $2,586,044    $2,128,496   $1,660,558   $1,713,649
   Times interest earned before income taxes (5)                         1.64X        1.99X         4.35X        3.05X        2.40X
   Capitalization ratios:
        Common equity (4)                                                  39%          43%           50%          57%          49%
        Preferred stock                                                     5%           2%            3%           3%           4%
        Long-term debt, excluding current portion                          56%          55%           47%          40%          47%
                                                                    ----------------------------------------------------------------
             Total                                                        100%         100%          100%         100%         100%
                                                                    ================================================================
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)  Refer to "MD&A - Alliant Energy Results of Operations" for a discussion of
the 2002, 2001 and 2000 results of operations.
(2) Includes $25 million ($0.32 per diluted  share) of net income from gains on
sales of McLeod  stock.
(3) Results reflect the recording of $54 million of pre-tax merger-related
charges.
(4) Alliant Energy adjusts the carrying value of its investments in McLeod to
its estimated fair value, pursuant to the applicable accounting rules.  At
December 31, 2002, 2001, 2000, 1999 and 1998, the carrying amount reflected an
unrealized gain (loss) of approximately $1 million, ($13) million, $543 million,
$1.1 billion and $291 million, respectively, with a net of tax increase
(decrease) to common equity of $0.4 million, ($9) million, $317 million, $640
million and $170 million,  respectively.
(5) Represents income from continuing operations before income taxes plus
preferred dividend  requirements of subsidiaries plus interest expense divided
by interest expense.

                                       30
<PAGE>

<TABLE>
<CAPTION>

IP&L                                              2002             2001             2000            1999            1998
----                                           -----------------------------------------------------------------------------
                                                                               (in thousands)

<S>                                                 <C>              <C>              <C>             <C>            <C>
Operating revenues                              $1,211,608       $1,316,250       $1,234,007      $1,142,801     $1,162,819
Earnings available for common stock                 88,015           94,656           99,724          93,896         77,278
Cash dividends declared on common stock             81,790           80,340           80,339         120,509         27,612
Total assets                                     2,738,406        2,426,314        2,524,802       2,415,068      2,446,315
Long-term obligations, net                         902,243          922,941          792,323         836,486        872,517

</TABLE>

Alliant Energy is the sole common shareowner of all 13,370,788 shares of
IP&L's common stock outstanding.  As such, earnings per share data is not
disclosed herein.  The 1998 financial results reflect the recording of $31
million of pre-tax merger-related charges.

<TABLE>
<CAPTION>

WP&L                                               2002            2001            2000             1999           1998
----                                           ------------------------------------------------------------------------------
                                                                              (in thousands)
<S>                                                 <C>              <C>             <C>              <C>            <C>
Operating revenues                                $972,078         $965,353        $862,381         $752,505       $731,448
Earnings available for common stock                 77,614           70,180          68,126           67,520         32,264
Cash dividends declared on common stock             59,645           60,449           --              58,353         58,341
Total assets                                     1,984,597        1,875,800       1,857,024        1,766,135      1,685,150
Long-term obligations, net                         523,308          523,183         569,309          471,648        471,554

</TABLE>

Alliant Energy is the sole common shareowner of all 13,236,601 shares of
WP&L's common stock outstanding.  As such, earnings per share data is not
disclosed herein.  The 1998 financial results reflect the recording of $17
million of pre-tax merger-related charges.

                                       31
<PAGE>

ITEM 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
           RESULTS OF OPERATIONS

                          FORWARD-LOOKING STATEMENTS

Statements contained in this report that are not of historical fact are
forward-looking statements intended to qualify for the safe harbors from
liability established by the Private Securities Litigation Reform Act of
1995.  Such forward-looking statements are subject to risks and uncertainties
that could cause actual results to differ materially from those expressed in,
or implied by, such statements.  Some, but not all, of the risks and
uncertainties include: factors listed in "Other Matters - Other Future
Considerations;" weather effects on sales and revenues; economic and
political conditions in Alliant Energy's domestic and international service
territories; federal, state and international regulatory or governmental
actions, including the ability to obtain adequate and timely rate relief,
including recovery of operating costs and earning reasonable rates of return,
and to pay expected levels of dividends; Alliant Energy's proposed asset
divestitures at expected values and on expected timelines; unanticipated
construction and acquisition expenditures; issues related to the supply of
purchased electricity and price thereof including the ability to recover
purchased-power and fuel costs through rates; risks related to the operations
of Alliant Energy's nuclear facilities; costs associated with Alliant
Energy's environmental remediation efforts and with environmental compliance
generally; developments that adversely impact Alliant Energy's ability to
implement its strategic plan; improved results from Alliant Energy's Brazil
investments and no material adverse changes in the rates allowed by the
Brazilian regulators; improved performance by Alliant Energy's other
non-regulated businesses as a whole; no material permanent declines in the
fair market value of, or expected cash flows from, Alliant Energy's
investments; continued access to the capital markets; Alliant Energy's
ability to continue cost controls and operational efficiencies; Alliant
Energy's ability to identify and successfully complete proposed acquisitions
and development projects; access to technological developments; employee
workforce factors, including changes in key executives, collective bargaining
agreements or work stoppages; and changes in the rate of inflation.  Alliant
Energy assumes no obligation, and disclaims any duty, to update the
forward-looking statements in this report.

                               STRATEGIC ACTIONS

In November 2002, Alliant Energy's Board of Directors approved five strategic
actions designed to maintain a strong credit profile for Alliant Energy,
strengthen its balance sheet and position Alliant Energy for improved
long-term financial performance.  The five strategic actions, which signaled
a shift to less aggressive growth targets driven primarily by Alliant
Energy's utility operations, included:

1.   A commitment to pursue the sale of, or other exit strategies for, a
     number of non-regulated businesses, including Alliant Energy's oil and
     gas (Whiting), Australian (including Southern Hydro) and affordable housing
     businesses.  For accounting purposes, such businesses
     have been classified as available for sale, and the
     operating results of these businesses have been
     separately classified and reported as discontinued operations, in Alliant
     Energy's Consolidated Financial Statements.  Alliant Energy anticipates
     strengthening its liquidity position by up to $800 million to $1 billion
     from reductions in consolidated debt and increasing its cash and
     temporary cash investment balances as a result of these transactions.
     The amount of proceeds ultimately received from these divestitures, and
     the timing of the completion of the transactions, are subject to a
     variety of factors, including the transaction structures Alliant Energy
     utilizes to exit these businesses.  In January 2003, Alliant Energy also
     decided to sell SmartEnergy which was classified as held and used, and
     its operating results were included in continuing operations, in Alliant
     Energy's Consolidated Financial Statements.  Refer to Note 16 of Alliant
     Energy's "Notes to Consolidated Financial Statements" for further
     discussion.
2.   A reduction in Alliant Energy's targeted annual common stock divided
     from $2.00 per share to $1.00 per share, effective with the dividend
     declared and paid in the first quarter of 2003.
3.   Reductions in Alliant Energy's aggregated anticipated 2002 and 2003
     construction and acquisition expenditures by approximately $400 million.
4.   A plan to raise approximately $200 to $300 million of common equity in
     2003, dependent on market conditions.  Alliant Energy expects to direct
     the majority of the proceeds towards additional capital investments in
     its regulated domestic utilities.
5.   The implementation of additional cost control measures to be
     accomplished through Alliant Energy's new Six Sigma program, the
     operation of its new enterprise resource planning system that was placed
     in service in October 2002 and by a heightened focus on operating its
     domestic utility business in a manner that aligns operating expenses with
     the revenues granted in its various rate filings.

                                       32
<PAGE>

Alliant Energy is continuing in its efforts to implement these strategic
actions.  Refer to "Other Matters - Other Future Considerations - Asset
Sales" for discussion of an agreement Alliant Energy recently entered into
related to the sale of its Australian business.

                         RATES AND REGULATORY MATTERS

Overview - Alliant Energy has two primary utility subsidiaries, IP&L and
--------
WP&L.  IP&L was formed as a result of the merger of IPC with and into IESU
effective Jan. 1, 2002.  WP&L has one utility subsidiary, South Beloit.

As a public utility holding company with significant utility assets, Alliant
Energy competes in an ever-changing utility industry.  Electric energy
generation, transmission and distribution are in a period of fundamental
change resulting from legislative, regulatory, economic and technological
changes.  These changes impact competition in the electric wholesale and
retail markets as customers of electric utilities are being offered
alternative suppliers.  Such competitive pressures could result in electric
utilities losing customers and incurring stranded costs (i.e., assets and
other costs rendered unrecoverable as the result of competitive pricing),
which would be borne by security holders if the costs cannot be recovered
from customers.

Alliant Energy's utility subsidiaries are currently subject to regulation by
FERC, and state regulation in Iowa, Wisconsin, Minnesota and Illinois.  FERC
regulates competition in the electric wholesale power generation market and
each state regulates whether to permit retail competition, the terms of such
retail competition and the recovery of any portion of stranded costs that are
ultimately determined to have resulted from retail competition.  Alliant
Energy cannot predict the timing of a restructured electric industry or the
impact on its financial condition or results of operations but does believe
it is well-positioned to compete in a deregulated competitive market.
Although Alliant Energy ultimately believes that the electric industry will
be deregulated, the pace of deregulation in its primary retail electric
service territories has been delayed due to more recent developments in the
industry.

Certain Recent Developments - In July 2002, FERC issued a notice of proposed
---------------------------
rules intended to standardize the wholesale electric market, which has
generated significant industry discussion.  Although Alliant Energy believes
that standardization of the wholesale electric market is appropriate and
would benefit market participants, there may be significant changes to the
proposed rules before they are adopted.  Therefore, Alliant Energy cannot
determine the impact the final rules will have on its results of operations
or financial condition.

Alliant Energy's merger-related price freezes expired in April 2002 in all of
its primary domestic utility jurisdictions and it is currently addressing the
recovery of its utility cost increases through numerous rate filings.  WP&L
has received final orders in two of its rate cases and IP&L and WP&L
currently have four other rate cases pending.  Details of these rate cases
are as follows (dollars in millions):

<TABLE>
<CAPTION>
                                                                                                      Expected
                                                    Interim     Interim      Final      Final          Final
               Utility    Filing      Increase     Increase    Effective   Increase    Effective      Effective
    Case        Type       Date       Requested   Granted (1)     Date      Granted      Date           Date        Notes
-------------- ------- -------------- ----------- ------------ ----------- ---------- ----------- ----------------- -------
    <S>         <C>         <C>           <C>          <C>        <C>          <C>       <C>           <C>           <C>
WP&L:
  2002 retail  E/G/W     Aug. 2001        $104          $49    April 2002      $82    Sept. 2002        N/A          (2)
  2003 retail  E/G/W     May 2002          101          TBD       TBD          TBD       TBD         April 2003
  2004 retail  E/G/W    March 2003          65          TBD       TBD          TBD       TBD         Jan. 2004
  Wholesale      E       Feb. 2002           6            6    April 2002        3    Jan. 2003         N/A          (3)
IP&L retail      E      March 2002          82           15    July 2002       TBD       TBD         June 2003       (4)
IP&L retail      G       July 2002          20           17    Oct. 2002       TBD       TBD         July 2003
                                      ----------- ------------             ----------
   Total                                  $378          $87                    $85
                                      =========== ============             ==========
</TABLE>

(1) Interim rate relief is implemented, subject to refund, pending
    determination of final rates.
(2) In its September 2002 final order, the PSCW increased the authorized
    return on common equity from 11.7% to 12.3%.
(3) In the fourth quarter of 2002, WP&L reached a settlement agreement with
    certain wholesale customers for an annual increase of $3 million and a
    refund of amounts previously collected in excess of the settlement.  The
    settlement agreement was approved by FERC in January 2003.  At Dec. 31,
    2002, WP&L had reserved all amounts related to the anticipated refund.

                                       33
<PAGE>

(4) In accordance with the interim rate relief rules in Iowa, IP&L only
    requested interim rate relief of $22 million.

A significant portion of the rate increases included in the previous table
reflect the recovery of anticipated increased costs incurred by IP&L and
WP&L, or costs they expect to incur, thus the increase in revenues related to
these cost increases would not result in a corresponding increase in income.
IP&L, WP&L and South Beloit are currently in the process of determining what
other rate case filings may be necessary in 2003.

WP&L's retail electric rates are based on annual forecasted fuel and
purchased-power costs.  Under PSCW rules, WP&L can seek emergency rate
increases if the annual costs are more than 3% higher than the estimated
costs used to establish rates.  For 2001 and 2002, any collections in excess
of costs incurred must be refunded, with interest.  Accordingly, WP&L has
established a reserve due to overcollection of past fuel and purchased-power
costs and expects to refund such amount in 2003.  The final ruling from the
PSCW could result in an increase or decrease to the reserve that has been
recorded.

The PSCW has issued new rules relating to the collection of fuel and
purchased-power costs by Wisconsin utilities, including WP&L.  The new rules
and related procedures are intended, among other things, to significantly
reduce regulatory lag for the utilities and customers related to the timing
of the recovery of increased or decreased fuel and purchased-power costs.
Purchased-power capacity costs will now be included in base rates.  A process
will also exist whereby the utilities can seek deferral treatment of
capacity, transmission and emergency costs between base rate cases.  The new
rules are expected to be implemented for WP&L with its pending 2003 retail
rate case.

In 2002, IP&L filed with the IRS for a change in method of accounting for tax
purposes for 1987 through 2001 that would allow a current deduction related
to mixed service costs.  Such costs had previously been capitalized and
depreciated for tax purposes over the appropriate tax lives.  This change
would create a significant current tax benefit which has not been reflected
in IP&L's results of operations pending a decision from the IUB on the
required rate making treatment of the benefit.  There would be no material
negative impact on IP&L's results of operations or financial position should
the IUB and/or IRS reject IP&L's proposal.

                      ALLIANT ENERGY RESULTS OF OPERATIONS

Unless otherwise noted, all "per share" references in the Results of
Operations section refer to earnings per diluted share.  Refer to Note 1(a)
of Alliant Energy's "Notes to Consolidated Financial Statements" for
discussion of the various components of Alliant Energy's business.

Alliant Energy Overview - Alliant Energy's EPS for 2002, 2001 and 2000 were
-----------------------
as follows:

<TABLE>
<CAPTION>
                                                                            2002          2001         2000
                                                                          ----------    ---------    ----------
<S>                                                                          <C>           <C>           <C>
Income from continuing operations                                           $0.84         $1.57         $4.18
Income from discontinued operations                                          0.34          0.73          0.64
Cumulative effect of changes in accounting principle                          --          (0.16)         0.21
                                                                          ----------    ---------    ----------
Net income                                                                  $1.18         $2.14         $5.03
                                                                          ==========    =========    ==========
</TABLE>

Income from continuing operations in 2002 and 2001 included $0.46 per share
and $0.26 per share, respectively, of valuation charges incurred in its
non-regulated businesses.  Income from continuing operations in 2000 included
$2.37 per share of non-cash income related to Alliant Energy's adoption of
SFAS 133.  In addition to the higher valuation charges, the lower 2002 income
from continuing operations was primarily the result of lower earnings from
Alliant Energy's non-regulated businesses.  This was primarily due to a net
loss of $47 million from Alliant Energy's Brazil investments in 2002,
compared to a net loss of $24 million in 2001, lower earnings from Alliant
Energy's Mass Marketing business and higher interest expense.  Improved
results from Alliant Energy's China and New Zealand businesses partially
offset the lower non-regulated results.  Income from Alliant Energy's
domestic utility business increased slightly in 2002 as higher electric and
gas margins were largely offset by increased operating expenses and a higher
effective income tax rate.

                                       34
<PAGE>

Domestic Electric Utility Margins - Electric margins and MWh sales for
---------------------------------
Alliant Energy were as follows (in thousands):

<TABLE>
<CAPTION>
                                             Revenues and Costs                                     MWhs Sold
                            ------------------------------------------------------ --------------------------------------------
                               2002         2001        *        2000        **     2002     2001      *       2000      **
                            ------------ ------------ ------- ------------  ------ ------- --------- ------- --------- --------
<S>                                <C>          <C>    <C>          <C>      <C>      <C>     <C>     <C>        <C>    <C>
Residential                     $626,947     $599,074   5%        $567,283    6%     7,616   7,344     4%       7,161    3%
Commercial                       376,365      373,145   1%         349,019    7%     5,542   5,464     1%       5,364    2%
Industrial                       526,804      543,471  (3%)        501,155    8%    12,297  12,469    (1%)     13,092   (5%)
                            ------------ ------------         ------------         ------- ---------         ---------
   Total from ultimate
      customers                1,530,116    1,515,690   1%       1,417,457    7%    25,455  25,277     1%      25,617   (1%)
Sales for resale                 160,335      184,507 (13%)        173,148    7%     4,805   4,936    (3%)      4,906    1%
Other                             62,083       56,359  10%          57,431   (2%)      197     168    17%         174   (3%)
                            ------------ ------------         ------------         ------- ---------         ---------
   Total revenues/sales        1,752,534    1,756,556  --        1,648,036    7%    30,457  30,381     --      30,697   (1%)
                                                                                   ======= =========         =========
Electric production
   fuels expense                 286,474      292,002  (2%)        271,073    8%
Purchased-power expense          362,501      403,166 (10%)        294,818   37%
                            ------------ ------------         ------------
   Margin                     $1,103,559   $1,061,388   4%      $1,082,145   (2%)
                            ============ ============         ============
</TABLE>

* Reflects the percent change from 2001 to 2002.  ** Reflects the percent
change from 2000 to 2001.

To comply with FERC regulatory requirements governing transmission systems,
WP&L transferred its transmission assets to ATC on Jan. 1, 2001, in exchange
for cash and an equity ownership in ATC.  The wheeling expenses from ATC
included in electric margin in 2002 and 2001 were offset by equity income
(WP&L accounts for its investment in ATC under the equity method), reduced
other operation and maintenance expenses and lower depreciation expense,
resulting in no significant net income impact due to the formation of ATC.
On a comparable basis, electric margin increased $42.2 million, or 4%, and
$9.6 million, or 1%, for 2002 and 2001, respectively.  The 2002 increase was
primarily due to the impact of rate increases implemented in 2002, more
favorable weather conditions, lower purchased-power and fuel costs and
continued modest retail customer growth.  These increases were partially
offset by reduced energy conservation revenues (which were largely offset by
lower energy conservation expense) and the impact of a sluggish economy.  The
2001 increase was primarily due to lower purchased-power and fuel costs
impacting margin, increased residential and commercial sales due to more
favorable weather conditions in 2001 compared to 2000 and continued retail
customer growth.  These items were partially offset by $10 million of income
recorded in 2000 for a change in estimate of WP&L's utility services rendered
but unbilled at month-end due to the implementation of a refined estimation
process and lower industrial sales, largely due to impacts of a slowing
economy.

Gas Utility Margins - Gas margins and Dth sales for Alliant Energy were as
-------------------
follows (in thousands):

<TABLE>
<CAPTION>
                                         Revenues and Costs                                       Dths Sold
                         ---------------------------------------------------- --------------------------------------------------
                            2002        2001        *        2000       **      2002       2001        *       2000       **
                         ----------- ----------- -------- ----------- ------- ---------- ---------- -------- ---------- --------
<S>                          <C>         <C>        <C>        <C>      <C>       <C>        <C>       <C>        <C>      <C>
Residential                $218,746    $270,248    (19%)     $245,697   10%      30,931     29,580      5%       32,026    (8%)
Commercial                  111,343     141,121    (21%)      127,104   11%      19,348     18,055      7%       19,696    (8%)
Industrial                   25,177      31,262    (19%)       27,752   13%       5,373      5,344      1%        5,350    --
Transportation/other         38,720      45,246    (14%)       14,395  214%      47,386     48,539     (2%)      43,931    10%
                         ----------- -----------          -----------         ---------- ----------          ----------
   Total revenues/sales     393,986     487,877    (19%)      414,948   18%     103,038    101,518      1%      101,003     1%
                                                                              ========== ==========          ==========
Cost of utility gas sold    248,994     360,911    (31%)      278,734   29%
                         ----------- -----------          -----------
   Margin                  $144,992    $126,966     14%      $136,214   (7%)
                         =========== ===========          ===========
</TABLE>

* Reflects the percent change from 2001 to 2002.  ** Reflects the percent
change from 2000 to 2001.

Gas revenues and cost of utility gas sold were unusually high in 2001 due to
increased natural gas prices in the first half of 2001.  Due to Alliant
Energy's rate recovery mechanisms for gas costs, these price differences alone
had little impact on gas margin.  Gas margin increased $18.0 million, or 14%,
and decreased $9.2 million, or 7%, for 2002 and 2001, respectively.  The 2002
increase was largely due to the impact of several rate increases implemented
in 2002, improved results from WP&L's performance-based commodity cost
recovery program (which are shared by ratepayers and shareowners), continued
modest retail customer growth and the negative impact high gas prices in
early 2001 had on gas consumption during that period.  These increases were
partially offset by reduced energy conservation revenues (which were largely
offset by lower energy conservation expenses).  The 2001 decrease was largely
due to lower retail sales primarily related to the unusually high gas prices
in early 2001 as some customers either chose alternative fuel sources or used
less natural gas, the impact of the slowing economy and losses associated
with performance-based commodity costs at WP&L.  Alliant Energy realized

                                       35
<PAGE>

pre-tax income of $0, $4.0 million and $2 million from weather hedges it had
in place in 2002, 2001 and 2000, respectively, which is recorded in
"Miscellaneous, net" in the Consolidated Statements of Income.

Refer to Note 1(j) of Alliant Energy's "Notes to Consolidated Financial
Statements" for information relating to utility fuel and natural gas cost
recovery.  Refer to Note 2 of Alliant Energy's "Notes to Consolidated
Financial Statements" and "Rates and Regulatory Matters" for discussion of
various rate filings.

Non-regulated and Other Revenues - Details regarding Alliant Energy's
--------------------------------
non-regulated and other revenues are as follows (in millions):

                                      2002            2001            2000
                                  -------------   -------------   -------------
Integrated Services                     $259            $242            $172
International                            103              85              --
Mass Marketing                            47               7               1
Investments                               26              27              29
Other (includes eliminations)             27              19              15
                                  -------------   -------------   -------------
                                        $462            $380            $217
                                  =============   =============   =============

The 2002 Integrated Services increase was primarily due to higher natural gas
sales, partially offset by decreased gas prices and lower energy services
revenues.  The increased International revenues for 2002 were primarily due
to the 2001 acquisitions of additional combined heat and power facilities in
China.  Mass Marketing revenues for 2002 increased due to the fourth quarter
2001 acquisition of a controlling interest in SmartEnergy, an energy services
company operating in competitive energy markets.  The 2001 Integrated
Services increase was primarily due to acquisitions in the third and fourth
quarters of 2000 of various energy services businesses.  The 2001
International increase resulted from the December 2000 change from the equity
method of accounting to the consolidation method for an investment in China
and the addition of five combined heat and power facilities to Alliant
Energy's China portfolio during the fifteen months prior to Dec. 31, 2001.

Other Operating Expenses - Other operation and maintenance expenses were as
------------------------
follows (in millions):
                                      2002           2001            2000
                                  -------------  -------------   -------------
Utility                                 $555           $509           $497
Integrated Services                      242            229            158
International                             83             69              4
Mass Marketing                            57              8              2
Investments                               15             16             18
Other (includes eliminations)              5             (3)             8
                                  -------------  -------------  -------------
                                        $957           $828           $687
                                  =============  =============  =============

The 2002 utility increase was primarily due to increased fossil and nuclear
generation, employee benefit and energy delivery expenses, partially offset
by lower energy conservation expenses and decreased uncollectible customer
account balances.  Alliant Energy is addressing these cost increases in
various utility rate proceedings that are currently pending.  The 2001
utility increase was primarily due to higher transmission wheeling and other
costs in Alliant Energy's energy delivery business unit, increased nuclear
operating costs (partially due to a planned refueling outage at Kewaunee in
2001), higher uncollectible customer account balances largely due to the
unusually high gas prices earlier in the year and higher costs in the
generation business unit.  These increases were partially offset by the
impact of the formation of ATC earlier in 2001, as discussed in "Domestic
Electric Utility Margins."

The Integrated Services, International and Mass Marketing variances were
largely driven by the same factors impacting the revenue variances discussed
previously.  The Mass Marketing 2002 increase was also impacted by increases
in the provisions for uncollectible accounts at SmartEnergy in 2002.  Charges
of $5 million and $2 million are included in "Other" in 2002 and 2001,
respectively, for cancelled generation projects in Alliant Energy's
Non-regulated Generation business unit.  The 2001 Integrated Services
increase was partially offset by a one-time charge of $4 million related to a
loss on a contract in 2000.

Depreciation and amortization expense increased $8.0 million and $5.9 million
in 2002 and 2001, respectively.  Contributing to both increases were utility
property additions, acquisitions at the non-regulated businesses and

                                       36
<PAGE>

increased regulatory and software amortizations.  Increased earnings on the
WP&L nuclear decommissioning trust fund also contributed to the 2002
increase.  The 2002 increase was partially offset by lower expenses due to: a
decrease of $14 million from implementation of lower depreciation rates at
IP&L on Jan. 1, 2002, resulting from an updated depreciation study; lower
decommissioning expense based on reduced retail funding levels at WP&L; and
the elimination of $5 million of goodwill amortization expense in compliance
with new accounting rules effective in 2002.  The 2001 increase was partially
offset by the impact of the formation of ATC in 2001, as discussed in
"Domestic Electric Utility Margins," and lower earnings on the WP&L nuclear
decommissioning trust fund.  The accounting for earnings on the nuclear
decommissioning trust fund results in no net income impact.  Miscellaneous,
net income increases for earnings on the trust fund and the corresponding
offset is recorded through depreciation expense at WP&L.

Taxes other than income taxes increased $2.1 million and $4.4 million in 2002
and 2001, respectively, primarily due to increased property taxes in 2002 and
increased gross receipts and payroll taxes in 2001.

Interest Expense and Other - Interest expense increased $0.9 million and
--------------------------
$17.5 million in 2002 and 2001, respectively.  Both increases were impacted
by higher non-regulated borrowings, partially offset by the impact of lower
interest rates on Alliant Energy's variable rate borrowings.  The 2002
increase was also partially offset by lower short-term debt borrowings at the
Alliant Energy parent level, largely due to the impact of proceeds received
in November 2001 from a common equity offering.

Alliant Energy recorded income tax and associated interest income of $0.13
per share in 2001 related to a ruling in a tax refund case.  The federal
government decided in the fourth quarter of 2001 not to pursue the ruling in
favor of Alliant Energy by the U.S. Court of Appeals for the 8th Circuit
dealing with capital losses disallowed under audit by the IRS and certain
related deductions.  An additional potential refund of approximately $14
million, plus interest, remains a contested issue in this case.  Alliant
Energy cannot offer any assurance it will be successful in obtaining this
additional refund and has not recognized any income for the potential
additional refund.

Equity income (loss) from Alliant Energy's unconsolidated investments was as
follows (in millions):
                                      2002           2001            2000
                                  -------------  --------------  -------------
ATC (began operations 1/01)             $14            $15             $--
New Zealand                               4             --               3
China*                                    2              2               1
Cargill-Alliant (sold in 2002)            1              7              15
Synfuel (began operations 5/02)         (13)            --              --
Brazil                                  (23)            (4)              3
Other                                     2             (1)             (3)
                                  -------------  -------------   -------------
                                       ($13)           $19             $19
                                  =============  =============   =============

* Majority of investments are accounted for under the consolidation method.

Equity income from unconsolidated investments decreased $32 million in 2002.
The differences in income from New Zealand during the three years were
largely due to the 2001 results being depressed because of drought
conditions. The lower earnings in 2002 and 2001 at Cargill-Alliant were
impacted by fewer weather-related trading opportunities and less volatile
market prices.  Refer to "Liquidity and Capital Resources - Sales of
Non-strategic Assets" for discussion relating to Alliant Energy's sale of
this investment in 2002.  In the second quarter of 2002, Synfuel, a direct
subsidiary of Resources, purchased an equity interest in a synthetic fuel
processing facility.  The synthetic fuel project generates operating losses
at its fuel processing facility, which are more than offset by tax credits
and the tax benefit of the losses the project generates.  All tax benefits
are included in "Income taxes" in Alliant Energy's Consolidated Statements of
Income.  The lower 2002 results from the Brazil investments were largely due
to losses incurred by Alliant Energy's investment in a gas-fired generating
plant, charges incurred in 2002 related to the recovery of the impacts of
rationing and other prior costs and higher interest expense.  The loss from
the generating plant was due to the impact of a significant decline in the
currency rates associated with the debt issued to finance the plant and a
depressed wholesale energy market in 2002.  Increased electric sales volumes
in 2002 compared to 2001, largely due to the impacts of the drought-driven
rationing program that was in place for approximately seven months in 2001
compared to only two months in 2002, partially offset the lower Brazil
earnings.  The 2001 Brazil results included a charge related to the impacts
of a settlement reached between the Brazilian government and the distribution
companies on the economic resolution of various cost recovery issues.

                                       37
<PAGE>

Refer to Note 9 of Alliant Energy's "Notes to Consolidated Financial
Statements" for discussion of the asset valuation charges recorded by Alliant
Energy in 2002 related to its McLeod available-for-sale securities.

On July 1, 2000, Alliant Energy adopted SFAS 133 for its consolidated
entities.  Related to the adoption, Alliant Energy recorded a $321.3 million
pre-tax gain from the designation of a portion of Alliant Energy's McLeod
holdings as trading securities.  This gain related to the unrealized
appreciation in value of approximately 27% of Alliant Energy's McLeod
holdings that were designated as trading as of the adoption date.

Miscellaneous, net income decreased $12.7 million and $26.7 million in 2002
and 2001, respectively.  The 2002 decrease was due to the recording of
pre-tax asset valuation charges of $10 million and $9 million related to
Alliant Energy's Energy Technologies and Enermetrix investments,
respectively, lower interest income (the 2001 results included $10 million
from tax settlements), a pre-tax goodwill impairment charge of $7 million at
SmartEnergy and gains from asset sales realized in 2001.  These decreases
were partially offset by lower pre-tax, non-cash SFAS 133 valuation charges
of $29 million, related to the net change in the value of the McLeod trading
securities and the derivative component of Resources' exchangeable senior
notes, and increased earnings on WP&L's nuclear decommissioning trust fund.
The 2001 decrease was largely due to higher pre-tax, non-cash SFAS 133
valuation charges of $33 million related to the net change in the value of
the McLeod trading securities and the derivative component of Resources'
exchangeable senior notes, reduced nuclear decommissioning trust fund
earnings and lower gains from asset sales.  These decreases were partially
offset by higher interest income, including the $10 million from tax
settlements in 2001.  Alliant Energy realized $0, $4 million and $2 million
of income from weather hedges in 2002, 2001 and 2000, respectively.

Refer to Note 10(a) of Alliant Energy's "Notes to Consolidated Financial
Statements" for additional information related to the exchangeable senior
notes embedded derivative, the McLeod trading securities and the cumulative
effect of changes in accounting principle.

Income Taxes - The effective income tax rates for Alliant Energy's continuing
------------
operations were 30.5%, 27.6% and 40.1% in 2002, 2001 and 2000, respectively.
Refer to Note 5 of Alliant Energy's "Notes to Consolidated Financial
Statements" for additional information.

Income from Discontinued Operations - The 2002 decrease of $28 million in
-----------------------------------
income from discontinued operations was largely due to lower earnings from
Alliant Energy's oil and gas (Whiting) business due to lower prices, higher
operating expenses and lower gains from dispositions of oil and gas
properties in 2002 compared to 2001.  Tax adjustments recorded in 2002
related to Alliant Energy's decision to sell its Australian (Southern Hydro)
and affordable housing businesses also contributed to the lower income.  The
2002 decrease was partially offset by higher oil and gas sales volumes at
Whiting and higher earnings from Southern Hydro due to increased generation
and sales of renewable energy credits earned through the generation of
hydropower.  The 2001 increase in income was largely due to non-cash SFAS 133
income in 2001 related to the valuation of electricity derivatives at
Southern Hydro and higher earnings from Whiting which resulted from higher
gas prices earlier in 2001, increased oil and gas sales volumes and income
from a reduction in the estimated dismantlement cost of an offshore oil and
gas platform.  The 2001 increase was partially offset by approximately $16
million of income from gains on the sale of 1.3 million shares of McLeod in
2000 by Alliant Energy's affordable housing business.  Refer to Note 16 of
Alliant Energy's "Notes to Consolidated Financial Statements" for further
discussion of Alliant Energy's discontinued operations.

                          IP&L RESULTS OF OPERATIONS

Overview - IP&L's earnings available for common stock decreased $6.6 million
--------
and $5.1 million in 2002 and 2001, respectively.  The 2002 decrease was
primarily due to increased operating expenses, a higher effective income tax
rate and lower interest income, partially offset by higher electric and gas
margins.  The 2001 decrease was primarily due to increased operating expenses
and lower electric and gas margins, partially offset by a lower effective
income tax rate and higher interest income.

                                       38
<PAGE>

Electric Utility Margins - Electric margins and MWh sales for IP&L were as
------------------------
follows (in thousands):
<TABLE>
<CAPTION>
                                            Revenues and Costs                                    MWhs Sold
                            ---------------------------------------------------  ---------------------------------------------
                              2002        2001         *       2000       **      2002      2001       *      2000       **
                            ---------- ------------ -------- ---------- -------  -------- --------- -------- --------  -------
<S>                             <C>        <C>         <C>      <C>      <C>        <C>       <C>     <C>       <C>     <C>
Residential                   $355,072   $350,946       1%    $337,615    4%       4,184     4,026     4%       4,010   --
Commercial                     229,639    234,876      (2%)    221,820    6%       3,392     3,342     1%       3,333   --
Industrial                     315,494    335,680      (6%)    311,070    8%       7,843     7,931    (1%)      8,404   (6%)
                            ---------- ------------          ----------          -------- ---------          --------
   Total from ultimate
      customers                900,205    921,502      (2%)    870,505    6%      15,419    15,299     1%      15,747   (3%)
Sales for resale                34,513     53,320     (35%)     57,433   (7%)      1,151     1,412   (18%)      1,678  (16%)
Other                           30,136     28,284       7%      27,907    1%         103       107    (4%)        111   (4%)
                            ---------- ------------          ----------          -------- ---------          --------
   Total revenues/sales        964,854  1,003,106      (4%)    955,845    5%      16,673    16,818    (1%)     17,536   (4%)
                                                                                 ======== =========          ========
Electric production
   fuels expense               153,982    171,280     (10%)    157,865    8%
Purchased-power expense        145,292    185,860     (22%)    147,879   26%
                            ---------- ------------          ----------
   Margin                     $665,580   $645,966       3%    $650,101   (1%)
                            ========== ============          ==========
</TABLE>
* Reflects the percent change from 2001 to 2002.  ** Reflects the percent
change from 2000 to 2001.

Electric margin increased $19.6 million, or 3%, and decreased $4.1 million,
or 1%, for 2002 and 2001, respectively.  The 2002 increase was primarily due
to the impact of the interim retail rate increase, lower purchased-power
capacity costs, more favorable weather conditions and continued modest retail
customer growth.  These increases were partially offset by reduced energy
conservation revenues of $10 million and the impacts of a sluggish economy.
The 2001 decrease was primarily due to reduced energy conservation revenues
of $5 million and lower sales largely due to impacts of a slowing economy,
partially offset by decreased purchased-power capacity costs and continued
retail customer growth.  For both 2002 and 2001, the reduced energy
conservation revenues were largely offset by lower energy conservation
expenses.

Gas Utility Margins - Gas margins and Dth sales for IP&L were as follows (in
-------------------
thousands):
<TABLE>
<CAPTION>
                                       Revenues and Costs                                  Dths Sold
                        -------------------------------------------------- -------------------------------------------
                          2002       2001        *        2000       **      2002     2001      *      2000      **
                        ---------- ---------- -------- ----------- ------- --------- -------- ------- -------- -------
<S>                         <C>        <C>       <C>       <C>       <C>      <C>      <C>     <C>      <C>      <C>
Residential               $124,237   $162,575   (24%)    $149,493    9%      18,068   17,826    1%     19,257   (7%)
Commercial                  61,222     82,463   (26%)      72,592   14%      10,774   10,483    3%     11,101   (6%)
Industrial                  18,197     22,355   (19%)      19,171   17%       4,070    4,147   (2%)     3,874    7%
Transportation/other        11,239     13,621   (17%)       8,540   59%      28,814   31,673   (9%)    30,251    5%
                        ---------- ----------          -----------         --------- --------         --------
   Total revenues/sales    214,895    281,014   (24%)     249,796   12%      61,726   64,129   (4%)    64,483   (1%)
                                                                           ========= ========         ========
Cost of gas sold           138,875    207,088   (33%)     171,603   21%
                        ---------- ----------          -----------
   Margin                  $76,020    $73,926     3%      $78,193   (5%)
                        ========== ==========          ===========
</TABLE>
* Reflects the percent change from 2001 to 2002.  ** Reflects the percent
change from 2000 to 2001.

Gas revenues and cost of gas sold were unusually high in 2001 due to the
increased natural gas prices in the first half of 2001.  Such fluctuations
alone had no impact on IP&L's gas margin given its rate recovery mechanism
for gas costs.  Gas margin increased $2.1 million, or 3%, and decreased $4.3
million, or 5%, for 2002 and 2001, respectively.  The 2002 increase was
primarily due to the impact of the interim retail rate increase and the
negative impact high gas prices in early 2001 had on gas consumption during
that period, partially offset by reduced energy conservation revenues of $4
million.  The 2001 decrease was largely due to lower retail sales primarily
related to unusually high gas prices earlier in 2001 as some customers either
chose alternative fuel sources or used less natural gas, the impact of the
slowing economy and reduced energy conservation revenues.  For both 2002 and
2001, the reduced energy conservation revenues were largely offset by lower
energy conservation expenses.

Refer to Note 1(j) of Alliant Energy's "Notes to Consolidated Financial
Statements" for information relating to utility fuel and natural gas cost
recovery.  Refer to Note 2 of Alliant Energy's "Notes to Consolidated
Financial Statements" and "Rates and Regulatory Matters" for discussion of
IP&L's rate filings.

Other Operating Expenses - Other operation and maintenance expenses increased
------------------------
$16.6 million and $14.2 million for 2002 and 2001, respectively.  The 2002
increase was primarily due to increased fossil and nuclear generation,
employee benefit and energy delivery expenses.  These increases were
partially offset by lower energy conservation expenses of $11 million and
decreased uncollectible customer account balances.  The 2001 increase was
primarily due to higher transmission wheeling and other energy delivery
costs, fossil and nuclear generation costs and uncollectible customer account

                                       39
<PAGE>

balances largely due to the unusually high gas prices earlier in 2001 and a
downturn in the economy.  These increases were partially offset by one-time
fees in 2000 related to the transfer from the MAPP reliability region to the
MAIN region and a decrease of $3 million in energy conservation expenses.

Depreciation and amortization expenses decreased $2.4 million and increased
$5.0 million for 2002 and 2001, respectively.  The 2002 decrease was
primarily due to a $14 million reduction in depreciation expense from
implementation of lower depreciation rates on Jan. 1, 2002, resulting from an
updated depreciation study, largely offset by property additions.  The 2001
increase was primarily due to property additions and amortization of
software.

Interest Expense and Other - Miscellaneous, net income decreased $3.9 million
--------------------------
and increased $6.0 million for 2002 and 2001, respectively, primarily due to
higher interest income in 2001 and income from weather hedges in 2001.  IP&L
realized $5 million and $4 million in interest income from tax settlements in
2001 and 2000, respectively.  The 2002 decrease was partially offset by
higher income from sales of non-commodity products and services.

Income Taxes - The effective income tax rates were 40.7%, 35.1% and 38.7% in
------------
2002, 2001 and 2000, respectively.  Refer to Note 5 of IP&L's "Notes to
Consolidated Financial Statements" for additional information.

                          WP&L RESULTS OF OPERATIONS

Overview - WP&L's earnings available for common stock increased $7.4 million
--------
and $2.1 million in 2002 and 2001, respectively.  The 2002 increase was
primarily due to higher electric and gas margins, partially offset by
increased operating expenses.  The 2001 increase was primarily due to higher
electric margins and a lower effective income tax rate, partially offset by
increased operating expenses and lower gas margins.

Electric Utility Margins - Electric margins and MWh sales for WP&L were as
------------------------
follows (in thousands):
<TABLE>
<CAPTION>
                                            Revenues and Costs                                  MWhs Sold
                            --------------------------------------------------- -------------------------------------------
                              2002        2001       *        2000       **      2002     2001      *      2000       **
                            ---------- ----------- ------- ----------- -------- -------- -------- ------- --------  -------
<S>                             <C>         <C>     <C>         <C>      <C>       <C>      <C>     <C>      <C>     <C>
Residential                  $271,875    $248,128   10%      $229,668     8%      3,432    3,318     3%     3,151     5%
Commercial                    146,726     138,269    6%       127,199     9%      2,150    2,122     1%     2,031     4%
Industrial                    211,310     207,791    2%       190,085     9%      4,454    4,538    (2%)    4,688    (3%)
                            ---------- -----------         -----------          -------- --------          -------
   Total from ultimate
      customers               629,911     594,188    6%       546,952     9%     10,036    9,978     1%     9,870     1%
Sales for resale              125,822     131,187   (4%)      115,715    13%      3,654    3,524     4%     3,228     9%
Other                          31,947      28,075   14%        29,524    (5%)        94       61    54%        63    (3%)
                            ---------- -----------         -----------          -------- --------          -------
   Total revenues/sales       787,680     753,450    5%       692,191     9%     13,784   13,563     2%    13,161     3%
                                                                                ======== ========          =======
Electric production
   fuels expense              132,492     120,722   10%       113,208     7%
Purchased-power expense       217,209     217,306    --       146,939    48%
                            ---------- -----------         -----------
   Margin                    $437,979    $415,422    5%      $432,044    (4%)
                            ========== ===========         ===========
</TABLE>
* Reflects the percent change from 2001 to 2002.  ** Reflects the percent
change from 2000 to 2001.

Due to the formation of ATC on Jan. 1, 2001, the wheeling expenses from ATC
included in electric margin in 2002 and 2001 were offset by equity income
(WP&L accounts for its investment in ATC under the equity method), reduced
other operation and maintenance expenses and lower depreciation expense,
resulting in no significant net income impact due to the formation of ATC.
On a comparable basis, electric margin increased $22.6 million, or 5%, and
$13.8 million, or 3%, during 2002 and 2001, respectively.  The 2002 increase
was primarily due to the implementation of various rate increases in 2002,
continued modest retail customer growth and more favorable weather conditions
in 2002 compared to 2001, partially offset by the sluggish economy.  The 2001
increase was primarily due to lower purchased-power and fuel costs impacting
margin, increased residential and commercial sales due to more favorable
weather conditions in 2001 compared to 2000 and continued retail customer
growth.  These items were partially offset by $10 million of income recorded
in 2000 for a change in estimate of utility services rendered but unbilled at
month-end due to the implementation of a refined estimation process and lower
industrial sales, largely due to impacts of a slowing economy.

                                       40
<PAGE>
Gas Utility Margins - Gas margins and Dth sales for WP&L were as follows (in
-------------------
thousands):
<TABLE>
<CAPTION>
                                       Revenues and Costs                                   Dths Sold
                        -------------------------------------------------- --------------------------------------------
                          2002       2001        *        2000      **       2002     2001      *      2000      **
                        --------- ----------- --------- --------- -------- --------- -------- ------- -------- --------
<S>                        <C>        <C>       <C>        <C>       <C>      <C>     <C>        <C>    <C>       <C>
Residential              $94,509    $107,673    (12%)    $96,204     12%     12,863   11,754      9%   12,769     (8%)
Commercial                50,121      58,658    (15%)     54,512      8%      8,574    7,572     13%    8,595    (12%)
Industrial                 6,980       8,907    (22%)      8,581      4%      1,303    1,197      9%    1,476    (19%)
Transportation/other      27,481      31,625    (13%)      5,855    440%     18,572   16,866     10%   13,680     23%
                        --------- -----------           ---------          --------- --------         --------
   Total revenues/sales  179,091     206,863    (13%)    165,152     25%     41,312   37,389     10%   36,520      2%
                                                                           ========= ========         ========
Cost of gas sold         110,119     153,823    (28%)    107,131     44%
                        --------- -----------           ---------
   Margin                $68,972     $53,040     30%     $58,021     (9%)
                        ========= ===========           =========
</TABLE>
* Reflects the percent change from 2001 to 2002.  ** Reflects the percent
change from 2000 to 2001.

Gas revenues and cost of gas sold were unusually high in 2001 due to the
large increase in natural gas prices in the first half of 2001.  Due to
WP&L's rate recovery mechanisms for gas costs, these increases alone had
little impact on gas margin.  Gas margin increased $15.9 million, or 30%, and
decreased $5.0 million, or 9%, during 2002 and 2001, respectively.  The 2002
increase was largely due to the implementation of a rate increase in 2002,
improved results from WP&L's performance-based commodity cost recovery
program, continued modest retail customer growth and the negative impact high
gas prices in early 2001 had on gas consumption during that period.  The 2001
decrease was largely due to lower retail sales primarily related to unusually
high gas prices earlier in 2001 as some customers either chose alternative
fuel sources or used less natural gas, the impact of the slowing economy and
lower results from WP&L's performance-based commodity cost recovery program.

Refer to Note 1(j) of Alliant Energy's "Notes to Consolidated Financial
Statements" for information relating to utility fuel and natural gas cost
recovery.  Refer to Note 2 of Alliant Energy's "Notes to Consolidated
Financial Statements" and "Rates and Regulatory Matters" for discussion of
WP&L's rate filings.

Other Operating Expenses - Due to the formation of ATC in 2001, WP&L incurred
------------------------
$10 million of operation and maintenance expenses in 2000 that were not
incurred in 2001.  On a comparable basis, other operation and maintenance
expenses increased $29.2 million and $7.6 million for 2002 and 2001,
respectively.  The 2002 increase was largely due to higher fossil generation,
employee benefit, energy conservation, and energy delivery expenses.  The
2001 increase was primarily due to higher nuclear operating costs (partially
due to a planned refueling outage at Kewaunee in the fourth quarter of 2001),
higher uncollectible customer account balances largely due to the unusually
high gas prices earlier in the year and higher other administrative and
general costs.  These items were partially offset by decreased fossil plant
maintenance expenses.

Depreciation and amortization expenses increased $7.1 million and decreased
$10.8 million for 2002 and 2001, respectively.  The 2002 increase was largely
due to higher regulatory and software amortizations.  Increased earnings on
the nuclear decommissioning trust fund were largely offset by lower
decommissioning expense based on reduced retail funding levels.  The 2001
decrease was primarily due to the impact of the formation of ATC and
decreased earnings on the nuclear decommissioning trust fund, partially
offset by increased expense due to property additions.  The accounting for
earnings on the nuclear decommissioning trust funds results in no net income
impact.  Interest income is increased for earnings on the trust fund, which
is offset in depreciation expense.

Taxes other than income taxes increased $3.3 million for 2001 due to
increased gross receipts and payroll taxes.

Interest Expense and Other - Interest expense decreased $3.3 million in 2002
--------------------------
due to lower average interest rates on the outstanding borrowings.  Interest
income increased $13.5 million and decreased $5.0 million in 2002 and 2001,
respectively, due to differences in earnings on the nuclear decommissioning
trust fund.  Equity income from unconsolidated investments increased $15.0
million in 2001, largely due to ATC beginning operations on Jan. 1, 2001.
Miscellaneous, net income decreased $7.3 million in 2002 primarily due to
lower income from sales of non-commodity products and services and income
realized from weather hedges in 2001.

Income Taxes - The effective income tax rates were 35.6%, 35.9% and 37.5% in
------------
2002, 2001 and 2000, respectively.  Refer to Note 5 of WP&L's "Notes to
Consolidated Financial Statements" for additional information.
                                       41
<PAGE>
                        LIQUIDITY AND CAPITAL RESOURCES

Overview - Alliant Energy's recent and proposed financing activities have
--------
been and will be undertaken against a backdrop of increased market concerns
about general economic conditions and corporate governance issues as well as
risks associated with particular sectors of the economy, including the energy
industry.  As a result of these factors, capital markets have become more
restrictive.  The commercial paper market, for example, has become more
limited for many companies in terms of the amounts of available capital and
the corresponding maturities.  Medium- and long-term debt markets have become
sensitive to increased credit ratings volatility and to a heightened
perception of liquidity risk in the energy sector.  As a result, investors
have become more selective and have differentiated among otherwise comparable
issuers in a way that has made the financing process more challenging.  In
response to these changing market conditions, Alliant Energy is working
closely with its financial advisors and others to access the capital it needs
to operate its businesses.  Based on its strong cash flows coupled with
actions Alliant Energy expects to take to strengthen its balance sheet,
Alliant Energy currently believes it will be able to secure the capital it
requires to implement its refined strategic plan.  Alliant Energy believes
its ability to secure additional capital will be significantly enhanced by
the completion of the actions addressed in "Strategic Actions," including the
divestiture of selected businesses.

Alliant Energy's capital requirements are primarily attributable to its
utility subsidiaries' construction and acquisition programs, Resources'
acquisition and investment opportunities and its debt maturities.  Alliant
Energy's utility subsidiaries anticipate financing their construction
expenditures, including new electric generation facilities, during 2003-2005
through internally generated funds supplemented, when necessary, by outside
financing.  Funding for Resources' acquisition and investment expenditures
over that same period of time is expected to be accomplished with a
combination of external financings, sales of assets and internally generated
funds.

In 2001, Alliant Energy and Resources received SEC approval for their ongoing
program of external financing, credit support arrangements and other related
proposals for the period through Dec. 31, 2004.  Among other things, the
approval authorized Alliant Energy directly or through financing subsidiaries
to issue common and preferred stock, unsecured long-term debt securities and
other equity-linked securities up to an amount of $1.5 billion; to provide
guarantees and credit support for obligations of its subsidiaries up to an
amount of $3 billion; to enter into hedging transactions to manage interest
rate costs and risk exposure; and to increase its aggregate investment limit
in EWGs and FUCOs to 100% of consolidated retained earnings.  The approval,
among other things, also authorized Resources to provide guarantees and
credit support for obligations of non-utility subsidiaries up to an amount of
$600 million outstanding at any one time and to spend up to $800 million to
construct or acquire energy assets that are incidental to the energy
marketing and oil and gas productions of its subsidiaries.  Alliant Energy's
ability to undertake any such financings contemplated by the SEC's order is
dependent on its ability to access the capital markets as described above.

Cash Flows - Selected information from Alliant Energy's, IP&L's and WP&L's
----------
Consolidated Statements of Cash Flows was as follows (in thousands):

<TABLE>
<CAPTION>
                                      Alliant Energy                            IP&L                                WP&L
                            ----------------------------------  ---------------------------------  --------------------------------
Cash flows from (used for):    2002       2001        2000         2002        2001        2000        2002        2001      2000
                            ----------------------------------  ---------------------------------  --------------------------------
 <S>                           <C>        <C>         <C>          <C>        <C>         <C>         <C>        <C>        <C>
 Operating activities        $544,040   $426,111    $393,090     $250,430   $305,948    $267,564    $223,750   $135,886   $174,060
 Financing activities          84,090    170,525     513,063        6,286   (102,086)    (77,716)    (27,685)   (19,176)       987
 Investing activities        (632,658)  (656,262)   (869,253)    (250,727)  (203,838)   (189,862)   (187,795)  (116,832)  (174,880)

</TABLE>

In 2002, Alliant Energy's cash flows from operating activities increased
primarily due to changes in working capital; cash flows from financing
activities decreased primarily due to proceeds from the issuance of common
stock in 2001, partially offset by a net increase in the amount of preferred
stock outstanding at IP&L; and cash flows used for investing activities
decreased primarily due to lower construction and acquisition expenditures
partially offset by proceeds received in 2001 from the transfer of WP&L's
transmission assets to ATC.  In 2001, Alliant Energy's cash flows from
financing activities decreased primarily due to net changes in amount of debt
issued and retired, partially offset by proceeds from the issuance of common
stock in 2001; and cash flows used for investing activities decreased
primarily due to lower non-regulated investments.

In 2002, IP&L's cash flows from operating activities decreased primarily due
to changes in working capital; cash flows used for financing activities
decreased due to a net increase in the amount of preferred stock outstanding
and a capital contribution of $60 million by Alliant Energy; and cash flows
used for investing activities increased due to increased levels of
construction expenditures.  In 2001, IP&L's cash flows from operating
                                       42
<PAGE>

activities increased primarily due to changes in working capital; cash flows
used for financing activities increased due to the net changes in the amount
of debt issued and retired; and cash flows used for investing activities
increased due to higher levels of construction expenditures.  In 2002, WP&L's
cash flows from operating activities increased due to changes in working
capital; and cash flows used for investing activities increased primarily due
to proceeds received from the transfer of WP&L's transmission assets to ATC
in 2001.  In 2001, WP&L's cash flows from operating activities decreased due
to changes in working capital; cash flows used for financing activities
increased due to common stock dividends paid in 2001 as no dividends were
declared in 2000 due to management of WP&L's capital structure, partially
offset by a capital contribution of $35 million by Alliant Energy and changes
in debt issued and retired; cash flows used for investing activities
decreased in 2001 primarily due to proceeds received from the transfer of
WP&L's transmission assets to ATC.

Common Equity - In November 2002, Alliant Energy announced its intentions to
-------------
raise approximately $200 million to $300 million of common equity in 2003,
dependent on market conditions.  The proceeds are expected to be used to fund
the Power Iowa initiative and other regulated domestic utility needs.  The
PSCW has indicated it will require an additional equity infusion by Alliant
Energy into WP&L during 2003.  Alliant Energy anticipates the final PSCW
order, which is expected to be issued in the second quarter of 2003, will
also include a customer refund provision if the timing and/or amount of the
equity infusion differs from the assumptions included in the WP&L rate case.

Preferred Stock - In September 2002, IP&L redeemed all of its then
---------------
outstanding shares of preferred stock at an aggregate redemption price of
$58.3 million.  In December 2002, IP&L issued six million shares of preferred
stock at $25.00 per share in a private placement.  IP&L used the net proceeds
of approximately $145 million to repay its short-term debt and for general
corporate purposes, including to fund capital expenditures and to repay other
debt.

Debt - In June 2002, Alliant Energy received approval (through Dec. 31, 2004)
----
from the SEC to issue and sell up to an aggregate amount of $1 billion of
short-term debt outstanding at any one time and to guarantee borrowings by
Resources in an aggregate amount that would not exceed $700 million at any
one time in addition to its other guarantee authority.  In addition, IP&L
received SEC approval to issue short-term debt in a principal amount which
would not at any one time exceed $300 million.  Alliant Energy discontinued
the use of its utility money pool in 2002 and WP&L and IP&L are now meeting
any short-term borrowing needs by issuing commercial paper and borrowing on
bank lines of credit, respectively.

Alliant Energy and its subsidiaries are party to various credit facilities
and other borrowing arrangements, some of which are summarized below.  In
addition to the specific covenants detailed below under the 364-day revolving
credit agreements, Alliant Energy's facilities and borrowing arrangements
contain various customary terms and conditions, including required
capitalization, net worth and interest coverage requirements, maintenance
requirements related to bonded property and cross-default provisions.  At
Dec. 31, 2002, Alliant Energy and its subsidiaries were in compliance with
the financial ratios and covenant requirements under their respective credit
facilities and borrowing arrangements.  The aggregate borrowing capacity
under short-term credit agreements of Alliant Energy and its subsidiaries at
Dec. 31, 2002 was $845 million.  At Dec. 31, 2002, the total amount borrowed
under these facilities was $281 million leaving unused capacity of $564
million.  In addition, Resources had a $250 million standby credit facility
at Dec. 31, 2002 as discussed below.  There are no borrowings currently
outstanding under such facility.  Alliant Energy also had $28 million of
short-term borrowings outstanding at Dec. 31, 2002 related to various
generation projects in China.

In October 2002, Alliant Energy completed the syndication of three 364-day
revolving credit facilities totaling $915 million, available for direct
borrowing or to support commercial paper, which replaced the former
facilities that totaled $900 million in borrowing availability.  The three
facilities consist of a $565 million facility for Alliant Energy (at the
parent company level), which was reduced to $450 million at the end of 2002,
a $200 million facility for IP&L and a $150 million facility for WP&L.
Availability under the Alliant Energy credit facility will be further reduced
by the proceeds of asset sales in excess of 5% of Alliant Energy's
consolidated assets in any 12-month period commencing October 2002 and up to
$50 million from the proceeds of an issuance of equity securities in excess
of $300 million.  These new credit facility agreements contain various
covenants, including the following:

                                       43
<PAGE>
<TABLE>
<CAPTION>
          Covenant Description                  Covenant Requirement        Status at Dec. 31, 2002
------------------------------------------    -------------------------    --------------------------
<S>                                               <C>                                 <C>
Alliant Energy:
   Consolidated debt-to-capital ratio *       Less than 65%                          59.6%
   Consolidated net worth *                   At least $1.4 billion              $1.8 billion
   EBITDA interest coverage ratio *           At least 2.5x                          3.6x
IP&L debt-to-capital ratio                    Less than 58%                          47.9%
WP&L debt-to-capital ratio                    Less than 58%                          40.7%

</TABLE>

* In compliance with the agreements, results of discontinued operations have
  been included in the covenant  calculations.

The debt component of the capital ratios includes long- and short-term debt
(excluding trade payables), capital lease obligations, letters of credit and
guarantees of the foregoing and unfunded vested benefits under pension
plans.  The equity component excludes accumulated other comprehensive income
(loss).  Alliant Energy is also subject to a PUHCA requirement whereby
Alliant Energy's common equity balance must be at least 30% of its total
consolidated capitalization, including short-term debt.  Alliant Energy's
common equity ratio as of Dec. 31, 2002, as computed under such requirement,
was 35.8%.

In December 2002, Resources secured a 364-day $250 million standby credit
facility.  Designed as a bridge to enhance Alliant Energy's short-term
liquidity position until it receives the expected proceeds from the assets it
plans to sell in 2003, the availability under the facility is reduced by
amounts realized on such asset sales.  At Dec. 31, 2002, there were no
borrowings outstanding under this credit facility.  Also in December 2002,
Whiting finalized a secured revolving $200 million credit facility which will
mature in December 2005.  At Dec. 31, 2002, Whiting had $185 million of
borrowings outstanding under this facility at an interest rate of 3.63%,
which was included in "Long-term debt" on Alliant Energy's Consolidated
Balance Sheet.

Information regarding commercial paper and bank facility borrowings at Dec.
31, 2002 was as follows (dollars in millions):
<TABLE>
<CAPTION>
                                            Alliant Energy (Parent)         WP&L
                                           --------------------------   -------------
<S>                                                  <C>                    <C>
Commercial paper outstanding                        $135.5                 $60.0
Weighted average maturity
   of commercial paper                              2 days                34 days
Discount rates on commercial paper                   1.95%                  1.6%
Bank facility borrowings                             $85.0                   --
Interest rates on bank facility borrowings         2.3-2.4%                  --

</TABLE>

As a result of the Moody's downgrade of Alliant Energy's commercial paper in
January 2003 to P-3, Alliant Energy's ability to issue commercial paper at
the parent company level has been reduced, requiring greater reliance on bank
lines.  In addition to funding working capital needs, the availability of
short-term financing provides the companies flexibility in the issuance of
long-term securities.  The level of short-term borrowing fluctuates based on
seasonal corporate needs, the timing of long-term financing and capital
market conditions.  At Dec. 31, 2002, IP&L and WP&L were authorized by the
applicable federal or state regulatory agencies to issue short-term debt of
$180 million and $240 million, respectively.  The $240 million borrowing
authority for WP&L includes $85 million for general corporate purposes, an
additional $100 million should WP&L no longer sell its utility receivables
and an additional $55 million should WP&L need to repurchase its variable
rate demand bonds.

In December 2002, Resources issued $300 million of 9.75% senior notes due
2013 in a private placement.  The notes are unconditionally guaranteed by
Alliant Energy.  Resources used the proceeds to repay short-term debt.

At Dec. 31, 2002, Alliant Energy, IP&L and WP&L had $783 million, $175
million and $255 million, respectively, of long-term debt that will mature
prior to Dec. 31, 2007.  The $783 million at Alliant Energy represents
long-term debt maturities of $47 million in 2003, $106 million in 2004, $337
million in 2005, $68 million in 2006 and $225 million in 2007.  Depending
upon market conditions, it is currently anticipated that a majority of the
maturing debt will be refinanced with the issuance of long-term securities.

                                       44
<PAGE>

Refer to "Construction and Acquisition Expenditures" for information
regarding a credit facility Resources entered into in February 2003 relating
to the purchase of a non-regulated power plant.  Refer to Note 8 of the
"Notes to Consolidated Financial Statements" for additional
information on short- and long-term debt.

Credit Ratings and Balance Sheet - Access to the long- and short-term capital
--------------------------------
and credit markets, and costs of external financing, are dependent on
creditworthiness.  Alliant Energy is committed to taking the necessary steps
required to maintain strong credit ratings and to strengthen its balance
sheet.  Refer to "Strategic Actions" for a discussion of specific actions
being taken in this regard.  Although Alliant Energy believes such actions
will enable it to strengthen its balance sheet and maintain strong credit
ratings, no assurance can be given that it will be able to maintain its
existing credit ratings.  If Alliant Energy's credit ratings are downgraded
in the future, then Alliant Energy's borrowing costs may increase and its
access to capital markets may be limited.  If access to capital markets
becomes significantly constrained, then Alliant Energy's results of
operations and financial condition could be materially adversely affected.
In December 2002 and January 2003, Standard & Poor's and Moody's,
respectively, issued revised credit ratings as follows (long-term debt
ratings only apply to senior debt):

<TABLE>
<CAPTION>
                                                          Standard & Poor's          Moody's
                                                         ---------------------    --------------
<S>                               <C>                            <C>                  <C>
IP&L                     Secured long-term debt                   A-                   A3
                         Unsecured long-term debt                BBB                  Baa1
                         Commercial paper                        A-2                   P-2
                         Corporate                               BBB+                 Baa1
WP&L                     Secured long-term debt                   A                    A1
                         Unsecured long-term debt                BBB+                  A2
                         Commercial paper                        A-2                   P-1
                         Corporate                                A-                   A2
Resources (a)            Unsecured long-term debt                BBB                  Baa3
                         Commercial paper                        A-2                   P-3
                         Corporate                               BBB+                 Baa3
Alliant Energy           Unsecured long-term debt                BBB                Not rated
                         Commercial paper                        A-2                   P-3
                         Corporate                               BBB+               Not rated

All Entities             Outlook                               Negative              Stable

</TABLE>

(a)  Resources' debt is fully and unconditionally guaranteed by Alliant
     Energy.

Ratings Triggers - The long-term debt of Alliant Energy and its subsidiaries
----------------
is not subject to any repayment requirements as a result of credit rating
downgrades or so-called "ratings triggers."  However, certain lease
agreements do contain such ratings triggers.  The threshold for these
triggers varies among the applicable leases.  If the payments were
accelerated under all the affected leases it would result in accelerated
payments of approximately $45 million.  In addition, the amount of proceeds
available to IP&L and WP&L from their sale of utility customer accounts
receivable programs could be reduced in the aggregate by approximately $20
million in the event of certain credit rating downgrades at the Alliant
Energy parent company level.  Alliant Energy and its subsidiaries are also
parties to various agreements, including purchased-power agreements, fuel
contracts and corporate guarantees that may be deemed to be in default in the
event of certain credit rating downgrades.  In the event of such a default,
Alliant Energy or its subsidiaries may be able to cure the default in a
number of ways, including posting letters of credit equal to the amount of
the exposure, unwinding the contract or paying the obligation.

Sale of Accounts Receivable - Refer to Note 4 of Alliant Energy's "Notes to
---------------------------
Consolidated Financial Statements" for information on Alliant Energy's sale
of accounts receivable program.

Off-Balance Sheet Arrangements - Alliant Energy utilizes synthetic leases to
------------------------------
finance its corporate headquarters, corporate aircraft, certain utility
railcars and a utility radio dispatch system.  Synthetic leases provide
favorable financing rates to Alliant Energy while allowing it to maintain
operating control of its leased assets.  Several of Alliant Energy's
synthetic leases involve the use of unconsolidated structured finance or
variable interest entities.  Alliant Energy has guarantees outstanding
related to the residual value of these synthetic leases.  Alliant Energy does
not currently anticipate entering into any additional synthetic leases.
Alliant Energy also uses variable interest entities for its utility sale of
accounts receivable program whereby IP&L and WP&L use proceeds from the sale
of the accounts receivable and unbilled revenues to maintain flexibility in
their capital structures, take advantage of favorable short-term interest
rates and finance a portion of their long-term cash needs.  The sale of

                                       45
<PAGE>

accounts receivables generates a significant amount of short-term financing
for IP&L and WP&L.  If this financing alternative were not available, IP&L
and WP&L anticipate they would have enough short-term borrowing capacity to
compensate.  Refer to "Ratings Triggers" for the impact of credit rating
downgrades on Alliant Energy and its subsidiaries related to these synthetic
leases and accounts receivable sales program.

Beginning in the third quarter of 2003, under FIN 46 it is reasonably
possible that Alliant Energy could be considered the primary beneficiary of
certain variable interest entities utilized for its synthetic lease
financings and receivable sales program and could be required to consolidate
the operating results and associated assets and liabilities of the variable
interest entities in its financial statements.  Alliant Energy is in the
process of evaluating the potential impacts of FIN 46.  Alliant Energy is
also currently evaluating the structure of its synthetic leases and
receivable sales program to determine if these structures can be modified to
qualify for off-balance sheet treatment under FIN 46.

Contractual Obligations - Alliant Energy's long-term contractual cash
-----------------------
obligations as of Dec. 31, 2002 were as follows (in millions):

<TABLE>
<CAPTION>

                                           2003      2004     2005     2006     2007   Thereafter    Total
                                          -------- --------- ------- --------- ------- ------------ ---------
<S>                                          <C>      <C>       <C>     <C>      <C>        <C>        <C>
Long-term debt  (Note 8) and
   capital lease obligations  (Note 3)       $62     $122      $347    $104     $227      $2,303     $3,165
Operating leases  (Note 3)                    45       76        95      99      123         384        822
Purchase obligations  (Note 11(b))           286      110        68      30       18          27        539
                                          -------- --------- ------- --------- ------- ------------ ---------
                                            $393     $308      $510    $233     $368      $2,714     $4,526
                                          ======== ========= ======= ========= ======= ============ =========

IP&L's long-term contractual cash obligations as of Dec. 31, 2002 were as follows (in millions):
                                           2003      2004     2005     2006     2007   Thereafter    Total
                                          -------- --------- ------- --------- ------- ------------ ---------
Long-term debt  (Note 8) and
   capital lease obligations  (Note 3)       $20      $16       $13     $96     $109        $663       $917
Operating leases  (Note 3)                     9        7        10       3        3          33         65
Purchase obligations  (Note 11(b))            99       25        14       6        4          --        148
                                          -------- --------- ------- --------- ------- ------------ ---------
                                            $128      $48       $37    $105     $116        $696     $1,130
                                          ======== ========= ======= ========= ======= ============ =========

WP&L's long-term contractual cash obligations as of Dec. 31, 2002 were as follows (in millions):
                                           2003      2004     2005     2006     2007   Thereafter    Total
                                          -------- --------- ------- --------- ------- ------------ ---------
Long-term debt  (Note 8)                     $--      $62       $88     $--     $105        $269       $524
Operating leases  (Note 3)                    27       61        75      76       76         335        650
Purchase obligations  (Note 11(b))            86       47        26      15       15          27        216
                                          -------- --------- ------- --------- ------- ------------ ---------
                                            $113     $170      $189     $91     $196        $631     $1,390
                                          ======== ========= ======= ========= ======= ============ =========
</TABLE>

At Dec. 31, 2002, long-term debt and capital lease obligations as noted in
the previous tables were included on the respective Consolidated Balance
Sheets.  In addition, at Dec. 31, 2002, there were various other long-term
liabilities and deferred credits included on the respective Consolidated
Balance Sheets that, due to the nature of the liabilities, the timing of
payments cannot be estimated and are therefore excluded from the tables.
Operating leases and purchase obligations are amounts committed under
contract which were not recorded on the respective Consolidated Balance
Sheets at Dec. 31, 2002, in accordance with GAAP.  Purchase obligations
represent normal business contracts used to ensure adequate purchased-power,
coal and natural gas supplies and to minimize exposure to market price
fluctuations.  In connection with Alliant Energy's, IP&L's and WP&L's
construction and acquisition programs, they also enter into commitments
related to such programs on an ongoing basis.

Sales of Non-strategic Assets - In the third quarter of 2002, Alliant Energy
-----------------------------
completed the sale of its 50% ownership interest in its Cargill-Alliant
electricity-trading joint venture to Cargill.  The sale proceeds were
approximately $19.3 million, the book value of Alliant Energy's share of the
joint venture.  As noted earlier, the strategic actions currently being
executed by Alliant Energy will focus on additional potential sales of
non-strategic assets, among other items.  Refer to "Strategic Actions,"
"Other Matters - Other Future Considerations" and Note 16 of Alliant Energy's
"Notes to Consolidated Financial Statements" for additional discussion on the
potential impact of future asset sales.

Credit Risk - Credit risk is inherent in Alliant Energy's operations and
-----------
relates to the risk of loss resulting from non-performance of contractual
obligations by a counterparty.  Alliant Energy maintains credit risk

                                       46
<PAGE>

oversight and sets limits and policies with regards to its counterparties,
which management believes minimizes its overall credit risk exposure.
However, there is no assurance that such policies will protect Alliant Energy
against all losses from non-performance by counterparties.

Environmental - Alliant Energy's pollution abatement programs are subject to
-------------
continuing review and are periodically revised due to changes in
environmental regulations, construction plans and escalation of construction
costs.  While management cannot precisely forecast the effect of future
environmental regulations on operations, it has taken steps to anticipate the
future while also meeting the requirements of current environmental
regulations.

Alliant Energy's facilities are subject to state and federal requirements of
the CAA, including meeting ambient air quality standards.  As a result of a
new rate-of-progress rule developed by the Wisconsin DNR, and based on
existing technology, Alliant Energy estimates the total aggregate capital
investments necessary by WP&L to comply with the new rules will be
approximately $19 million in 2003 through 2007.  Alliant Energy is also
currently addressing various other potential federal and state environmental
rulemakings and activities, including: 1) proposed revisions to the Wisconsin
Administrative Code concerning the amount of heat that WP&L's generating
stations can discharge into Wisconsin waters which could have a significant
impact on WP&L's operation of its Wisconsin generating facilities; 2)
potential new rules that may be pursued by the EPA and the states in the
Alliant Energy service territory related to various air emissions; 3) the
multiple requests WP&L has received from the EPA related to the historical
operation of WP&L's major coal-fired generating units, which requests have
been the precursor to penalties and additional capital requirements in some
cases involving similar requests to other electric generating facilities; 4)
the New Source Review reforms published by the EPA in December 2002; 5)
several other legislative and regulatory proposals regarding the control of
emissions of air pollutants and greenhouse gases from a variety of sources,
including generating facilities; and 6) the July 2002 request from the
Wisconsin DNR that WP&L submit a written plan for facility closure of the
Rock River Generating Station landfill and clean-up of its support ponds and
all areas where coal combustion waste is present.  Alliant Energy cannot
presently predict the final outcome of these proposals or actions, but
believes that required capital investments and/or modifications resulting
from them could be significant.  Alliant Energy believes that prudent
expenses incurred by IP&L and WP&L likely would be recovered in rates from
its customers.

Refer to Note 11(e) of the "Notes to Consolidated Financial
Statements" for further discussion of environmental matters.

Construction and Acquisition Expenditures - Capital expenditures, investments
-----------------------------------------
and financing plans are continually reviewed, approved and updated as part of
Alliant Energy's ongoing strategic planning and annual budgeting processes.
In addition, material capital expenditures and investments are subject to a
rigorous cross-functional review prior to approval.  Changes in Alliant
Energy's anticipated construction and acquisition expenditures may result from
a number of reasons including economic conditions, regulatory requirements,
ability to obtain adequate and timely rate relief, the level of Alliant
Energy's profitability, Alliant Energy's desire to maintain strong credit
ratings and reasonable capitalization ratios, variations in sales, changing
market conditions and new opportunities.  As noted in "Strategic Actions,"
Alliant Energy recently reduced its anticipated construction and acquisition
expenditure levels in order to strengthen its balance sheet.  Alliant Energy
believes its capital control processes adequately reduce the risks associated
with large capital expenditures and investments.

Alliant Energy currently anticipates construction and acquisition
expenditures as follows (in millions):
<TABLE>
<CAPTION>
                                                                2003        2004-2005
                                                            -------------  -------------
<S>                                                              <C>             <C>
Domestic utility:
   IP&L utility infrastructure and reliability investments       $230            $560
   IP&L Power Iowa program*                                       220              80
   WP&L utility infrastructure and reliability investments        160             410
Non-regulated domestic generation                                 130              10
Other non-regulated business development                           80              70
                                                            -------------  -------------
        Total from continuing operations                          820           1,130
Discontinued operations                                            80              --
                                                            -------------  -------------
        Total                                                    $900          $1,130
                                                            =============  =============
</TABLE>
*  Excludes approximately $109 million in 2003 for potential purchase of
   turbines and related equipment from affiliates.

                                       47
<PAGE>

Alliant Energy has not entered into contractual commitments relating to the
majority of its anticipated capital expenditures.  As a result, Alliant
Energy does have discretion as to the eventual level of capital expenditures
incurred and it closely monitors and updates such estimates on an ongoing
basis based on numerous economic and other factors.

In September 2002, the IUB approved a settlement agreement establishing
advance rate making principles for the proposed 500 MW natural gas-fired
plant IP&L plans to construct in Mason City, Iowa as part of its Power Iowa
initiative to develop new electric generation capacity in Iowa.  The
settlement establishes, among other things, a set depreciation period whereby
IP&L is ensured of recovering the estimated $400 million cost of its
investment over 28 years based on a fixed 12.23% return on the common equity
component.  In January 2003, the IUB approved IP&L's siting certificate for
the Mason City plant and construction began.  The plant is scheduled to be in
service prior to the 2004 summer peak demand.

Given the status of the current non-regulated generation market, Alliant
Energy's initial investments in this market will focus on facilities with
underlying long-term purchased-power agreements.  While Alliant Energy
believes there are excellent acquisition opportunities in the existing
non-regulated generation market, it will continue to be patient, prudent and
diligent in its pursuit of such opportunities.  Consistent with this
approach, in February 2003, Resources announced the purchase of a 309 MW,
non-regulated, natural gas-fired power plant in Wisconsin for $109 million,
which Resources financed with a $73 million 8-year secured credit facility,
which is non-recourse to Alliant Energy.  At Feb. 28, 2003, Resources had $60
million of borrowings outstanding under this facility, at an interest rate of
approximately 5%, and an $11 million letter of credit related to a purchased-
power agreement.  The entire power output of the facility is sold under
contract to Milwaukee-based We Energies through June 2008.

                                 OTHER MATTERS

Market Risk Sensitive Instruments and Positions - Alliant Energy's primary
-----------------------------------------------
market risk exposures are associated with interest rates, commodity prices,
equity prices and currency exchange rates.  Alliant Energy has risk
management policies to monitor and assist in controlling these market risks
and uses derivative instruments to manage some of the exposures.

Interest Rate Risk - Alliant Energy is exposed to risk resulting from changes
in interest rates as a result of its issuance of variable-rate debt, utility
customer accounts receivable sale program and variable-rate leasing
agreements.  Alliant Energy manages its interest rate risk by limiting its
variable interest rate exposure and by continuously monitoring the effects of
market changes on interest rates.  Alliant Energy also uses interest rate
swap and interest rate forward agreements to assist in the management of its
interest exposure.  In the event of significant interest rate fluctuations,
management would take actions to minimize the effect of such changes on
Alliant Energy's results of operations and financial condition.  Assuming no
change in Alliant Energy's, IP&L's and WP&L's consolidated financial
structure, if variable interest rates were to average 100 basis points higher
(lower) in 2003 than in 2002, interest expense and pre-tax earnings would
increase (decrease) by approximately $9.4 million, $1.5 million and $2.5
million, respectively.  These amounts were determined by considering the
impact of a hypothetical 100 basis point increase (decrease) in interest
rates on Alliant Energy's, IP&L's and WP&L's consolidated variable-rate debt
held, the amount outstanding under the utility customer accounts receivable
sale program and variable-rate lease balances at Dec. 31, 2002.

Commodity Risk - Non-trading - Alliant Energy is exposed to the impact of
market fluctuations in the commodity price and transportation costs of
electricity and natural gas products it markets.  Alliant Energy employs
established policies and procedures to manage its risks associated with these
market fluctuations including the use of various commodity derivatives.
Alliant Energy's exposure to commodity price risks in its utility business is
significantly mitigated by the current rate making structures in place for
the recovery of its electric fuel and purchased energy costs as well as its
cost of natural gas purchased for resale.  Refer to Note 1(j) of Alliant
Energy's "Notes to Consolidated Financial Statements" for further
discussion.

WP&L periodically utilizes gas commodity derivative instruments to reduce the
impact of price fluctuations on gas purchased and injected into storage
during the summer months and withdrawn and sold at current market prices
during the winter months.  The gas commodity swaps in place approximate the
forecasted storage withdrawal plan during this period.  Therefore, market
price fluctuations that result in an increase or decrease in the value of the
physical commodity are substantially offset by changes in the value of the
gas commodity swaps.  To the extent actual storage withdrawals vary from
forecasted withdrawals, WP&L has physical commodity price exposure.  A 10%

                                       48
<PAGE>

increase (decrease) in the price of gas would not have a significant impact
on the combined fair market value of the gas in storage and related swap
arrangements in place at Dec. 31, 2002.  IP&L also utilizes natural gas
commodity derivative instruments to mitigate the risk of rising prices.
Since the IUB allows for the prudently incurred costs associated with these
instruments and the underlying supply of natural gas to be recovered from
ratepayers, IP&L does not have significant natural gas commodity risk
exposure.

Whiting, currently accounted for as a discontinued operation, is exposed to
market risk in the pricing of its oil and gas production.  Historically,
prices received for oil and gas production have been volatile because of
seasonal weather patterns, supply and demand factors, transportation
availability and price, and general economic conditions.  Worldwide political
developments have historically also had an impact on oil prices.  Whiting
periodically utilizes oil and gas swaps, costless collars and long-term
delivery contracts to mitigate the impact of oil and gas price fluctuations.
Historically, Alliant Energy has hedged or contracted approximately 50% of
its oil and gas volumes.  The actual level of hedging or contracting utilized
is based on management's assessment of the prudency of hedging given current
market conditions and other factors and is reviewed on an ongoing basis.
Based on Whiting's estimated oil and gas sales in 2003, and the hedging and
delivery contracts outstanding for such period, a sustained 10% increase
(decrease) in oil and gas prices would impact Alliant Energy's pre-tax 2003
earnings by approximately $9.9 million.

Southern Hydro, currently accounted for as a discontinued operation, owns and
operates hydroelectric generation facilities in the state of Victoria in
Australia.  These generation facilities operate as peaking units.  Under the
rules of the Australian market, Southern Hydro must sell all of its
production into a spot market in which the price changes every five minutes
and is set on the average of each half hour.  Electricity prices in this
market can and have been very volatile.  In order to manage the electricity
commodity price risk associated with anticipated sales into the spot market,
Southern Hydro enters into a variety of electricity derivative contracts with
terms of up to five years.  The value of these derivative instruments can
change significantly as a result of changes in forward electricity prices.
These instruments do not qualify for hedge accounting under SFAS 133.
Accordingly, per GAAP, changes in the fair value of these derivatives, which
are non-cash valuation adjustments, must be reported in Southern Hydro's
earnings.  Alliant Energy believes Southern Hydro's ownership of the physical
generating facilities that are not marked-to-market, combined with the
electricity derivative contracts, act as an economic hedge to volatile
electricity prices, such that Southern Hydro's net economic exposure to
volatile electricity prices over the next five years is managed within
reasonable limits.  Southern Hydro manages market risks inherent in its
business through established derivative trading and risk management policies
and tools.  The principal tool utilized in managing the risks associated with
volatile prices is a five to 40-day Earnings-at-Risk (EAR) model which
calculates EAR to a 95% confidence level.  At December 31, 2002, the
estimated EAR for Southern Hydro for expected earnings in 2003 was
approximately $0.9 million.

Equity Price Risk - IP&L and WP&L maintain trust funds to fund their
anticipated nuclear decommissioning costs.  At Dec. 31, 2002 and 2001, these
funds were invested primarily in domestic equity and debt instruments.
Fluctuations in equity prices or interest rates will not affect Alliant
Energy's consolidated results of operations as such fluctuations are recorded
in equally offsetting amounts of investment income and depreciation (WP&L) or
interest (IP&L) expense when they are realized.  In 2001, WP&L entered into a
four-year hedge on equity assets in its nuclear decommissioning trust fund.
Refer to Note 10(c) of Alliant Energy's "Notes to Consolidated Financial
Statements" for further discussion.

Currency Risk - Alliant Energy has investments in various countries where the
net investments are not hedged, including Australia, Brazil, China and New
Zealand.  As a result, these investments are subject to currency exchange
risk with fluctuations in currency exchange rates.  At Dec. 31, 2002, Alliant
Energy had a cumulative foreign currency translation loss, net of any tax
benefits realized, of $165 million, which related to decreases in value of
the Brazil real of $152 million, New Zealand dollar of $11 million and
Australian dollar of $2 million in relation to the U.S. dollar.  This loss is
recorded in "Accumulated other comprehensive loss" on Alliant Energy's
Consolidated Balance Sheets.  Based on Alliant Energy's investments at Dec.
31, 2002, a 10% sustained increase/decrease over the next 12 months in the
foreign exchange rates of Australia, Brazil, China and New Zealand would
result in a corresponding increase/decrease in the cumulative foreign
currency translation loss of $57 million.  Alliant Energy's equity income
(loss) from its foreign investments is also impacted by fluctuations in
currency exchange rates.  In addition, Alliant Energy has currency exchange
risk associated with the debt issued to finance a thermal plant constructed
by Alliant Energy and its Brazilian partners.  In 2002, Alliant Energy
recorded pre-tax charges of $6.5 million related to its share of the foreign
currency transaction losses on such debt.  Based on the loan balance and

                                       49
<PAGE>

currency rates at Dec. 31, 2002, a 10% change in the currency rates would
result in a $1.9 million after-tax increase (decrease) in net income.

Refer to Notes 1(n) and 10 of Alliant Energy's "Notes to Consolidated
Financial Statements" for further discussion of Alliant Energy's derivative
financial instruments.

Accounting Pronouncements - On Oct. 25, 2002, the EITF reached a consensus on
-------------------------
EITF Issue 02-3.  Alliant Energy's natural gas trading business, NG Energy
Trading, LLC (NG Energy), is impacted by EITF Issue 02-3, which requires that
all sales of energy and the related cost of energy purchased under contracts
that meet the definition of energy trading contracts under EITF Issue 98-10
and that are derivatives under SFAS 133 must be reflected on a net basis in
the income statement for all periods presented.  Under the guidance of EITF
Issue 98-10, Alliant Energy reported its energy trading contracts and related
gas in storage at fair market value, and reported related revenues and
expenses on a gross basis in the income statement.  EITF Issue 02-3 also
rescinded EITF Issue 98-10 on a prospective basis.  Accordingly, any new
contracts entered into after Oct. 25, 2002 must be reported on a historical
cost basis rather than at fair market value unless the contract meets the
definition of a derivative under SFAS 133.  Alliant Energy adopted EITF Issue
02-3 on Jan. 1, 2003 for all contracts that were in place and storage gas
acquired prior to Oct. 25, 2002, and will reclassify prior period trading
contracts on a net basis in the income statement for 2003.  The impact of
transitioning from reporting inventory and existing contracts that are not
derivatives under SFAS 133 at fair value to historical cost will be reported
in net income in the first quarter of 2003 and is not expected to be material
due to the relatively small size of the NG Energy business.  Had Alliant
Energy presented its trading activities in the income statement on a net
basis rather than a gross basis, for 2002, 2001 and 2000, "Non-regulated and
other" revenues and "Other operation and maintenance" expenses would have
both decreased $125 million, $49 million and $9 million, respectively, with
no impact on net income.

In November 2002, the FASB issued FIN 45 which requires disclosures by a
guarantor about its obligations under certain guarantees that it has issued.
FIN 45 also requires recognizing, at the inception of a guarantee, a
liability for the fair value of the obligation undertaken in issuing the
guarantee.  The recognition and measurement provisions of FIN 45 are
effective on a prospective basis for guarantees issued or modified after Dec.
31, 2002.  The disclosure requirements of FIN 45 are effective for financial
statements of interim or annual periods ending after Dec. 15, 2002.  Alliant
Energy does not anticipate FIN 45 will have a material impact on its
financial condition or results of operations.  Refer to Note 11(d) of Alliant
Energy's "Notes to Consolidated Financial Statements" for additional
information on guarantees.

In January 2003, the FASB issued FIN 46 which addresses consolidation by
business enterprises of variable interest entities.  FIN 46 requires
consolidation where there is a controlling financial interest in a variable
interest entity or where the variable interest entity does not have
sufficient equity at risk to finance its activities without additional
subordinated financial support from other parties.  Alliant Energy will apply
the provisions of FIN 46 prospectively for all variable interest entities
created after Jan. 31, 2003.  For variable interest entities created before
Jan. 31, 2003, Alliant Energy will be required to consolidate all entities in
which it is a primary beneficiary beginning in the third quarter of 2003.  It
is reasonably possible the implementation of FIN 46 will require that certain
variable interest entities be included on Alliant Energy's Consolidated
Balance Sheets.  Refer to Notes 3 and 4 of Alliant Energy's "Notes to
Consolidated Financial Statements" for additional information on variable
interest entities related to synthetic leases and the utility customer
accounts receivable sale program, respectively.

SFAS 143, which provides accounting and disclosure requirements for
retirement obligations associated with long-lived assets, was effective Jan.
1, 2003.  SFAS 143 requires that the present value of retirement costs for
which Alliant Energy has a legal obligation be recorded as liabilities with
an equivalent amount added to the asset cost.  The liability is accreted to
its present value each period and the capitalized cost is depreciated over
the useful life of the related asset.  Upon settlement of the liability, an
entity settles the obligation for its recorded amount or incurs a gain or
loss.  The adoption of SFAS 143 will have no impact on IP&L's and WP&L's
earnings, as the effects will be offset by the establishment of regulatory
assets or liabilities pursuant to SFAS 71, "Accounting for the Effects of
Certain Types of Regulation."

Alliant Energy has completed a detailed assessment of the specific
applicability and implications of SFAS 143.  The scope of SFAS 143 as it
relates to Alliant Energy primarily includes decommissioning costs for DAEC
and Kewaunee.  It also applies to a smaller extent to several other regulated
and non-regulated assets including, but not limited to, active ash landfills,
water intake facilities, underground storage tanks, groundwater wells,

                                       50
<PAGE>

transmission and distribution equipment, easements, leases and the
dismantlement of certain hydro facilities.  Other than DAEC and Kewaunee,
Alliant Energy's asset retirement obligations as of Jan. 1, 2003 are not
significant.

Prior to January 2003, IP&L and WP&L recorded nuclear decommissioning charges
in accumulated depreciation on their Consolidated Balance Sheets.  Upon
adoption of SFAS 143, IP&L and WP&L will reverse approximately $125 million
and $175 million, respectively, previously recorded in accumulated
depreciation and will record liabilities of approximately $250 million and
$175 million, respectively.  The difference between amounts previously
recorded and the net SFAS 143 liability will be deferred as a regulatory
asset and is expected to approximate $125 million and $0 for IP&L and WP&L,
respectively.

IP&L and WP&L have previously recognized removal costs as a component of
depreciation expense and accumulated depreciation for other non-nuclear
assets in accordance with regulatory rate recovery.  As of Dec. 31, 2002,
IP&L and WP&L estimate that they have approximately $250 million and $150
million, respectively, of such regulatory liabilities recorded in
"Accumulated depreciation" on their Consolidated Balance Sheets.

In 2001,  the FASB  issued  SFAS 144,  "Accounting  for the  Impairment  or
Disposal of Long-Lived  Assets" which  replaced  SFAS 121,  "Accounting  for the
Impairment of Long-Lived  Assets and for  Long-Lived  Assets to Be Disposed Of."
SFAS 144 also applies to discontinued  operations.  SFAS 144 requires that those
long-lived  assets classified as held for sale be measured at the lower of their
carrying  amount or the fair value less cost to sell, and that no  depreciation,
depletion  and  amortization  shall be recorded  while an asset is classified as
held for sale.  Discontinued operations are no longer measured at net realizable
value or include amounts for operating  losses that have not yet occurred.  SFAS
144 also  broadens  the  reporting  of  discontinued  operations  to include all
components of an entity with operations that can be distinguished  from the rest
of the entity and that will be  eliminated  from the ongoing  operations  of the
entity in a planned  disposal  transaction  that is probable of being  completed
within one year.  If the  criteria to classify  operations  as held for sale are
subsequently  no longer  met,  the assets  classified  as held for sale shall be
reclassified  as held and used in the period the held for sale  criteria  are no
longer met. Alliant Energy adopted SFAS 144 on January 1, 2002. Refer to Note 16
of Alliant Energy's "Notes to Consolidated  Financial Statements" for additional
information about Alliant Energy's application of SFAS 144 in the fourth quarter
of 2002 as relates to various assets it is planning to sell.

Alliant Energy does not expect the various other new accounting
pronouncements not mentioned above that were effective in 2002 to have a
material impact on Alliant Energy's results of operations or financial
condition.

Critical Accounting Policies - Based on historical experience and various
----------------------------
other factors, Alliant Energy believes the policies identified below are
critical to its business and the understanding of its results of operations
as they require critical estimates be made based on the assumptions and
judgment of management.  The preparation of consolidated financial statements
requires management to make various estimates and assumptions that affect
revenues, expenses, assets, liabilities and the disclosure of contingencies.
The results of these estimates and judgments form the basis for making
judgments about the carrying values of assets and liabilities that are not
readily apparent from other sources.  Actual results may differ from these
estimates and judgments.  Alliant Energy's management has discussed these
critical accounting policies with the Audit Committee of its Board of
Directors.  Refer to Note 1 of Alliant Energy's "Notes to Consolidated
Financial Statements" for a discussion of Alliant Energy's accounting
policies and the estimates and assumptions used in the preparation of the
consolidated financial statements.

Regulatory Assets and Liabilities - Alliant Energy's domestic utility
business is regulated by various federal and state regulatory agencies.  As a
result, the regulated utilities qualify for the application of SFAS 71.  SFAS
71 recognizes that the actions of a regulator can provide reasonable
assurance of the existence of an asset or liability.  Regulatory assets or
liabilities arise as a result of a difference between GAAP and the accounting
principles imposed by the regulatory agencies.  Regulatory assets generally
represent incurred costs that have been deferred as they are probable of
recovery in customer rates.  Regulatory liabilities generally represent
obligations to make refunds to customers for various reasons.

Alliant Energy's utility subsidiaries recognize regulatory assets and
liabilities in accordance with the rulings of their federal and state
regulators and future regulatory rulings may impact the carrying value and
accounting treatment of Alliant Energy's regulatory assets and liabilities.
Alliant Energy periodically assesses whether the regulatory assets are
probable of future recovery by considering factors such as regulatory
environment changes, recent rate orders issued by the applicable regulatory
agencies and the status of any pending or potential deregulation
legislation.  The assumptions and judgments used by regulatory authorities
continue to have an impact on the recovery of costs, the rate of return on

                                       51
<PAGE>

invested capital and the timing and amount of assets to be recovered by
rates.  A change in these assumptions may result in a material impact on
Alliant Energy's results of operations.   Refer to Note 1(c) of Alliant
Energy's "Notes to Consolidated Financial Statements" for further discussion.

Asset Valuations -
Long-Lived Assets - Alliant Energy's Consolidated Balance Sheets include
-----------------
significant long-lived assets, which are not subject to recovery under SFAS
71.  As a result, Alliant Energy must generate future cash flows from such
assets in a non-regulated environment to ensure the carrying value is not
impaired.  Many of these assets are the result of capital investments which
have been made in recent years and have not yet reached a mature life cycle.
Alliant Energy assesses the carrying amount and potential impairment of these
assets whenever events or changes in circumstances indicate that the carrying
value may not be recoverable.  Factors Alliant Energy considers in
determining if an impairment review is necessary include a significant
underperformance of the assets relative to historical or projected future
operating results, a significant change in Alliant Energy's use of the
acquired assets or business strategy related to such assets, and significant
negative industry or economic trends.  When Alliant Energy determines an
impairment review is necessary, a comparison is made between the expected
undiscounted future cash flows and the carrying amount of the asset.  If the
carrying amount of the asset is the larger of the two balances, an impairment
loss is recognized equal to the amount the carrying amount of the asset
exceeds the fair value of the asset.  The fair value is determined by the use
of quoted market prices, appraisals, or the use of valuation techniques such
as expected discounted future cash flows.  Alliant Energy must make
assumptions regarding these estimated future cash flows and other factors to
determine the fair value of the respective assets.

Alliant Energy has made payments of $156 million for turbines and related
generation equipment at Dec. 31, 2002 and has also entered into commitments
for an additional $84 million.  Alliant Energy expects to utilize
approximately $124 million of such equipment in its first Power Iowa
generation project and is currently reviewing various other potential
generation projects to utilize the remaining $116 million of equipment.  As a
result, Alliant Energy has assessed the recoverability of the $116 million
equipment cost compared to the future anticipated cash flows from the
generation projects under review.  The future anticipated cash flows is a
significant estimate.  Alliant Energy has no current intentions to sell any
of this equipment.  If a decision was made to sell such equipment, the
recoverability of the equipment cost would be assessed by comparing the
future anticipated sales proceeds to the carrying value of the equipment.

Investments - Alliant Energy's Consolidated Balance Sheets include
-----------
investments in several available-for-sale securities accounted for in
accordance with SFAS 115.  Alliant Energy monitors any unrealized losses from
such investments to determine if the loss is considered to be a temporary or
permanent decline.  The determination as to whether the investment is
temporarily versus permanently impaired requires considerable judgment.  When
the investment is considered permanently impaired, the previously recorded
unrealized loss would be recorded directly to the income statement as a
realized loss.  Alliant Energy incurred pre-tax valuation charges under the
provisions of SFAS 115 of $27 million and $10 million related to its McLeod
and Energy Technologies investments, respectively, in 2002.  Alliant Energy's
Consolidated Balance Sheets also contain various other investments that are
evaluated for recoverability when indicators of impairment may exist.

Resources holds a non-controlling interest in five Brazilian electric utility
companies accounted for under the equity method of accounting.  The
recoverability of these equity method investments is assessed by comparing
the future anticipated local currency cash flows from these investments and
the carrying value of these investments.  The future anticipated cash flows
currently include anticipated periodic distributions that, when aggregated,
exceed the carrying value of these investments.  The future anticipated cash
flows represents a significant estimate.  The $214 million carrying value of
Alliant Energy's Brazil investments has been reduced by $210 million of
pre-tax cumulative foreign currency translation losses.  The net of tax
balance of $152 million has been recorded in "Accumulated other comprehensive
loss" on Alliant Energy's Consolidated Balance Sheet at Dec. 31, 2002.
Cumulative foreign currency translation losses are reflected in Alliant
Energy's results of operations only if the related investment is sold or
substantially liquidated.  If Alliant Energy would decide to exit these
Brazil investments in the future, the recoverability of these equity method
investments would be assessed by comparing the future anticipated sales
proceeds to the carrying value.  Alliant Energy has no current intention of
exiting these Brazil investments.

Resources' investment in Mexico consists of a loan receivable (including
accrued interest income) from a Mexican development company.  The loan
accrues interest at 8.75% and is secured by the undeveloped land of the
resort community.  Repayment of the loan principal and interest will be based
on a portion of the proceeds from the sales of real estate in the resort

                                       52
<PAGE>

community and therefore is dependent on the successful development of the
project and the ability to sell real estate.  The recoverability of this loan
receivable is currently assessed by comparing the fair value of the
undeveloped land of the resort community used to secure the loan and the
carrying value of the loan including accrued interest income.  Based on an
independent appraisal that indicated the fair value of the collateral was
less than the loan balance plus accrued interest, Alliant Energy recorded a
valuation allowance of approximately $7 million in the second quarter of 2002
and ceased accruing interest income on the loan.  Based on an updated
independent appraisal, Alliant Energy reversed the valuation allowance in the
fourth quarter of 2002 and resumed accruing interest income on the loan.  The
fair value of such collateral is a significant estimate.  Refer to Note 9 of
Alliant Energy's "Notes to Consolidated Financial Statements" for additional
information concerning Alliant Energy's investments in Brazil and Mexico.

Alliant Energy announced its intentions to sell various businesses in
November 2002 and is currently accounting for them as assets held for sale
and discontinued operations.  The estimated sales proceeds, less costs to
sell, for each business exceeded the carrying value of each business as of
Dec. 31, 2002.  Alliant Energy will continue to monitor the estimated sales
proceeds of its assets held for sale as they relate to the respective
carrying values.  Refer to Note 16 of Alliant Energy's "Notes to Consolidated
Financial Statements" for additional information.

Goodwill - As a result of the adoption of SFAS 142, "Goodwill and Other
--------
Intangible Assets," on Jan. 1, 2002, Alliant Energy is required to evaluate
its goodwill for impairment at least annually and more frequently when
indicators of impairment may exist.  At Dec. 31, 2002, Alliant Energy had $66
million of net goodwill (including $41 million, $10 million and $9 million
within its Cogenex, China and SmartEnergy reporting units, respectively) on
its Consolidated Balance Sheet.  If the fair value of a reporting unit is
less than its carrying value, including goodwill, a goodwill impairment
charge may be necessary.  Alliant Energy estimates the fair value of its
reporting units utilizing a combination of market value indicators and the
expected discounted future cash flows.  This process requires the use of
significant management estimates and judgments regarding cash flow
assumptions from future sales, operating costs and discount rates over an
indefinite life.  Alliant Energy's cash flow assumptions are derived using a
combination of historical trends, internal budgets, strategic plans and other
market information.  Each reporting unit is evaluated separately based on the
nature of its operations and therefore the assumptions vary by reporting unit
relative to its applicable circumstances.  To determine its discount rates,
Alliant Energy utilizes the capital asset pricing model which is based upon
market comparables adjusted for company-specific risk.  In the event market
comparables are not available, Alliant Energy utilizes expected industry
returns based upon published information.  In the fourth quarter of 2002,
Alliant Energy recorded a pre-tax goodwill impairment charge related to
SmartEnergy of $7 million.

Derivative Financial Instruments - Alliant Energy uses derivative financial
instruments to hedge exposures to fluctuations in interest rates, certain
commodity prices, volatility in a portion of natural gas sales volumes due to
weather and to mitigate the equity price volatility associated with certain
investments in equity securities.  Alliant Energy does not use such
instruments for speculative purposes.  To account for these derivative
instruments in accordance with the applicable accounting rules, Alliant
Energy must determine the fair value of its derivatives.  In accordance with
SFAS 133, the fair value of all derivative instruments are recognized as
either assets or liabilities in the balance sheet with the changes in their
value recognized in earnings for the non-regulated businesses, unless
specific hedge accounting criteria are met.  For IP&L and WP&L, changes in
the derivatives fair values are generally recorded as regulatory assets or
liabilities.  If an established, quoted market exists for the underlying
commodity of the derivative instrument, Alliant Energy uses the quoted market
price to value the derivative instrument.  For other derivatives, Alliant
Energy estimates the value based upon other quoted prices or acceptable
valuation methods.  Alliant Energy also reviews the nature of its contracts
for the purchase and sale of non-financial assets to assess whether the
contracts meet the definition of a derivative and the requirements to follow
hedge accounting as allowed by the applicable accounting rules.  The
determination of derivative status and valuations involves considerable
judgment.

The majority of Alliant Energy's derivative transactions are in its regulated
domestic utility business and based on the fuel and natural gas cost recovery
mechanisms in place, as well as other specific regulatory authorizations,
changes in fair market values of such derivatives generally have no impact on
Alliant Energy's results of operations.  Alliant Energy does have an embedded
derivative within its exchangeable senior notes that is impacted by the value
of McLeod stock.  Changes in the fair value of this derivative impact Alliant
Energy's results of operations and the changes did have a material impact on
Alliant Energy's 2001 results of operations.  However, given a significant
decline in the value of the McLeod stock, Alliant Energy does not expect
changes in the fair value of this derivative to have a material impact on
Alliant Energy's results of operations in the foreseeable future. In

                                       53
<PAGE>

addition, Alliant Energy has a small investment in a gas trading business.
Such business accounted for all of its trading transactions under EITF Issue
98-10 through 2002 and adopted the provisions of EITF Issue 02-3 on Jan. 1,
2003 (and for new transactions after Oct. 25, 2002).  However, due to the
insignificant size of this business, Alliant Energy does not expect this
accounting change to have a material impact on Alliant Energy's results of
operations in the future.

Unbilled Revenues - Unbilled revenues are primarily associated with Alliant
Energy's utility operations.  Energy sales to individual customers are based
on the reading of their meters, which occurs on a systematic basis throughout
the month.  At the end of each month, amounts of energy delivered to
customers since the date of the last meter reading are estimated and the
corresponding estimated unbilled revenue is recorded.  The unbilled revenue
estimate is based on daily generation volumes, estimated customer usage by
class, weather impacts, line losses and the most recent customer rates.  Such
process involves the use of various estimates, thus significant changes in
the estimates could have a material impact on Alliant Energy's results of
operations.

Accounting for Pensions - Alliant Energy accounts for pensions under SFAS 87,
"Employers' Accounting for Pensions."  Under these rules, certain assumptions
are made which represent significant estimates.  There are many factors
involved in determining an entity's pension liabilities and costs each period
including assumptions regarding employee demographics (including age, life
expectancies, compensation levels), discount rates, assumed rate of returns
and funding.  Changes made to the plan provisions may also impact current and
future pension costs.  Alliant Energy's assumptions are supported by
historical data and reasonable projections and are reviewed annually with an
outside actuary firm and an investment consulting firm.  As of Dec. 31, 2002,
Alliant Energy was using a 6.75% discount rate and a 9% annual rate of return
on investments.  In selecting an assumed discount rate, Alliant Energy
reviews various corporate Aa bond indices.  The 9% annual rate of return is
consistent with Alliant Energy's historical returns and is based on projected
long-term equity and bond returns, maturities and asset allocations.  A 100
basis point change in the discount rate would result in approximate changes
of $79 million and $7 million in Alliant Energy's qualified pension benefit
obligation and pension expense, respectively.  A 100 basis point change in
the rate of return would result in an approximate change of $4 million in
qualified pension expense.

Other Future Considerations - In addition to items discussed earlier in MD&A,
---------------------------
the following items could impact Alliant Energy's future financial condition
or results of operations:

Asset Sales - It is possible Alliant Energy could record material gains,
losses, accounting adjustments or other charges and/or income related to its
planned asset divestitures discussed in "Strategic Actions."  Alliant Energy
is not able to predict or estimate what such items may be at this time.
Refer to Note 16 of Alliant Energy's "Notes to Consolidated Financial
Statements" for additional information.

Alliant Energy announced in March 2003 that it entered into an agreement with
New Zealand-based Meridian Energy Limited for the sale of Alliant Energy's
Australian investment, primarily made up of Alliant Energy's ownership of
Southern Hydro.  The sale price will be approximately $350 million.  This
amount includes the repayment of approximately $145 million in debt in
Australia.  On an after-tax basis, the sale will result in net cash proceeds
to Alliant Energy of approximately $165 million.  The transaction is expected
to close by the end of April 2003 and is subject to customary closing
conditions.

Retirement Benefits - Alliant Energy's qualified pension and other
postretirement benefit expenses for 2003 are currently expected to be
approximately $18 million higher than in 2002, primarily due to unfavorable
asset returns, a reduction in the discount rate used to value plan benefit
obligations and expected increases in retiree medical costs.  Alliant Energy
will pursue the possible recovery of the utility portion of these cost
increases, which represents a significant majority of the increase, in any
rate filings it has in its various jurisdictions

Exchangeable Senior Notes - At Dec. 31, 2002, the carrying amount of the debt
component of Resources' exchangeable senior notes was $40.1 million,
consisting of the par value of $402.5 million, less unamortized debt discount
of $362.4 million.  The terms of the exchangeable senior notes require
Resources to pay interest on the par value of the notes at 7.25% from
February 2000 to February 2003, and at 2.5% thereafter until maturity in
February 2030.  As explained in Note 10(a) of Alliant Energy's "Notes to
Consolidated Financial Statements," Resources accounted for the net proceeds
from the issuance of the notes as two separate components, a debt component
and an embedded derivative component.  In accordance with SFAS 133, Alliant
Energy determined the initial carrying value of the debt component by
subtracting the fair value of the derivative component from the net proceeds
realized from the issuance of the exchangeable senior notes.  This resulted
in a very low initial carrying amount of the debt component which results in
the recording of interest expense at an effective rate of 26.8% of the
                                       54
<PAGE>
carrying amount of the debt component.  For 2002, interest expense on the
notes was $13.2 million.  Interest payments in excess of interest expense are
recorded as a reduction of the carrying amount of the debt component.  As a
result of the higher interest payments for the first three years, the
carrying amount of the debt component declined until it reached $37.8 million
in February 2003, and then gradually increases over the next 27 years to the
ultimate repayment amount of $402.5 million in 2030.  Interest expense on the
debt component of the notes will be $10.2 million in 2003, 2004 and 2005.  If
the existing McLeod shares would ever be cancelled, the notes would remain
outstanding until maturity.

Enterprise Resource Planning (ERP) System - Alliant Energy implemented a new
ERP system in October 2002 which will result in annual amortization expense
of approximately $11 million for five years.  Alliant Energy is seeking rate
recovery of the utility portion of the amortized expenses which represents a
significant majority of the amortized expenses.

                                       55

<PAGE>

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Quantitative and Qualitative Disclosures About Market Risk are reported under
"Other Matters - Market Risk Sensitive Instruments and Positions" in MD&A.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                                           INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>

Alliant Energy                                                                                      Page Number
--------------                                                                                      -----------
     <S>                                                                                               <C>
      Report of Management                                                                              57
      Independent Auditors' Report                                                                      58
      Consolidated Statements of Income for the Years Ended Dec. 31, 2002, 2001 and 2000                59
      Consolidated Balance Sheets as of Dec. 31, 2002 and 2001                                          60
      Consolidated Statements of Cash Flows for the Years Ended Dec. 31, 2002, 2001 and 2000            62
      Consolidated Statements of Capitalization as of Dec. 31, 2002 and 2001                            63
      Consolidated Statements of Changes in Common Equity for the Years Ended
         Dec. 31, 2002, 2001 and 2000                                                                   64
      Notes to Consolidated Financial Statements                                                        65

IP&L
----
      Independent Auditors' Report                                                                      94
      Consolidated Statements of Income for the Years Ended Dec. 31, 2002, 2001 and 2000                95
      Consolidated Balance Sheets as of Dec. 31, 2002 and 2001                                          96
      Consolidated Statements of Cash Flows for the Years Ended Dec. 31, 2002, 2001 and 2000            98
      Consolidated Statements of Capitalization as of Dec. 31, 2002 and 2001                            99
      Consolidated Statements of Changes in Common Equity for the Years Ended
         Dec. 31, 2002, 2001 and 2000                                                                   100
      Notes to Consolidated Financial Statements                                                        101

WP&L
----
      Independent Auditors' Report                                                                      109
      Consolidated Statements of Income for the Years Ended Dec. 31, 2002, 2001 and 2000                110
      Consolidated Balance Sheets as of Dec. 31, 2002 and 2001                                          111
      Consolidated Statements of Cash Flows for the Years Ended Dec. 31, 2002, 2001 and 2000            113
      Consolidated Statements of Capitalization as of Dec. 31, 2002 and 2001                            114
      Consolidated Statements of Changes in Common Equity for the Years Ended
         Dec. 31, 2002, 2001 and 2000                                                                   115
      Notes to Consolidated Financial Statements                                                        116

</TABLE>

Refer to Note 15 of Alliant Energy's, IP&L's and WP&L's "Notes to
Consolidated Financial Statements" for the quarterly financial data required
by Item 8.

                                       56
<PAGE>

        ALLIANT ENERGY CORPORATION REPORT ON THE FINANCIAL INFORMATION

Alliant Energy Corporation management is responsible for the information and
representations contained in the financial statements and in other sections
of this Annual Report.  The consolidated financial statements that follow
have been prepared in accordance with accounting principles generally
accepted in the United States of America.  In addition to selecting
appropriate accounting principles, management is responsible for the manner
of presentation and for the reliability of the financial information.  In
fulfilling that responsibility, it is necessary for management to make
estimates based on currently available information and judgments of current
conditions and circumstances.

Through a well-developed system of internal controls, management seeks to
ensure the integrity and objectivity of the financial information presented
in this report.  This system of internal controls is designed to provide
reasonable assurance that the assets of the company are safeguarded and that
the transactions are executed according to management's authorizations and
are recorded in accordance with the appropriate accounting principles.

The Board of Directors participates in the financial information reporting
process through its Audit Committee.





/s/ Erroll B. Davis, Jr.
------------------------
Erroll B. Davis, Jr.
Chairman, President and Chief Executive Officer



/s/ Thomas M. Walker
--------------------
Thomas M. Walker
Executive Vice President and Chief Financial Officer



/s/ John E. Kratchmer
---------------------
John E. Kratchmer
Vice President-Controller and Chief Accounting Officer




March 18, 2003



                                       57
<PAGE>

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Shareowners of Alliant Energy Corporation:

We have audited the accompanying consolidated balance sheets and statements
of capitalization of Alliant Energy Corporation and subsidiaries (the
"Company") as of December 31, 2002 and 2001, and related consolidated
statements of income, cash flows and changes in common equity for each of the
three years in the period ended December 31, 2002.  Our audit also included
the supplemental schedule listed in Item 15(a)(2).  These financial
statements and the supplemental schedule are the responsibility of the
Company's management.  Our responsibility is to express an opinion on these
financial statements and the supplemental schedule based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement.  An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements.  An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation.  We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all
material respects, the financial position of the Company as of December 31,
2002 and 2001, and the results of its operations and its cash flows for each
of the three years in the period ended December 31, 2002 in conformity with
accounting principles generally accepted in the United States of America.
Also, in our opinion, such supplemental schedule, when considered in relation
to the basic consolidated financial statements taken as a whole, presents
fairly in all material respects the information set forth therein.

As discussed in Note 10 to the financial statements, on July 1, 2000, the
Company changed its method of accounting for derivative instruments to adopt
Statement of Financial Accounting Standards No. 133, "Accounting for
Derivative Instruments and Hedging Activities," as amended ("SFAS 133"), and
on January 1, 2001, the Company's equity method investees changed their
method of accounting for derivative instruments to adopt SFAS 133.


/s/ DELOITTE & TOUCHE LLP
-------------------------


Milwaukee, Wisconsin
March 18, 2003

                                       58
<PAGE>
<TABLE>
<CAPTION>
                                                   ALLIANT ENERGY CORPORATION
                                               CONSOLIDATED STATEMENTS OF INCOME
                                                                                       Year Ended December 31,
                                                                            2002                 2001                 2000
---------------------------------------------------------------------------------------------------------------------------------
                                                                               (in thousands, except per share amounts)
<S>                                                                            <C>                  <C>                  <C>
Operating revenues:
  Electric utility                                                          $1,752,534           $1,756,556           $1,648,036
  Gas utility                                                                  393,986              487,877              414,948
  Non-regulated and other                                                      462,292              380,243              216,690
                                                                      -----------------    -----------------    -----------------
                                                                             2,608,812            2,624,676            2,279,674
                                                                      -----------------    -----------------    -----------------
---------------------------------------------------------------------------------------------------------------------------------
Operating expenses:
  Electric and steam production fuels                                          303,625              310,689              288,621
  Purchased power                                                              362,501              403,166              294,818
  Cost of utility gas sold                                                     248,994              360,911              278,734
  Other operation and maintenance                                              957,144              828,125              686,976
  Depreciation and amortization                                                310,617              302,643              296,732
  Taxes other than income taxes                                                104,236              102,184               97,823
                                                                      -----------------    -----------------    -----------------
                                                                             2,287,117            2,307,718            1,943,704
                                                                      -----------------    -----------------    -----------------
---------------------------------------------------------------------------------------------------------------------------------
Operating income                                                               321,695              316,958              335,970
                                                                      -----------------    -----------------    -----------------
---------------------------------------------------------------------------------------------------------------------------------
Interest expense and other:
  Interest expense                                                             186,538              185,604              168,149
  Interest income from loans to discontinued operations, net                   (15,959)              (9,938)              (7,195)
  Equity (income) loss from unconsolidated investments                          12,825              (18,799)             (19,468)
  Allowance for funds used during construction                                  (7,696)             (11,144)              (8,761)
  Preferred dividend requirements of subsidiaries                                6,172                6,720                6,713
  Impairment of available-for-sale securities of McLeodUSA Inc.                 27,218                    -                    -
  Gain on reclassification of investment                                             -                    -             (321,349)
  Miscellaneous, net                                                               220              (12,497)             (39,214)
                                                                      -----------------    -----------------    -----------------
                                                                               209,318              139,946             (221,125)
                                                                      -----------------    -----------------    -----------------
---------------------------------------------------------------------------------------------------------------------------------
Income from continuing operations before income taxes                          112,377              177,012              557,095
                                                                      -----------------    -----------------    -----------------
---------------------------------------------------------------------------------------------------------------------------------
Income taxes                                                                    36,108               50,767              226,180
                                                                      -----------------    -----------------    -----------------
---------------------------------------------------------------------------------------------------------------------------------
Income from continuing operations                                               76,269              126,245              330,915
                                                                      -----------------    -----------------    -----------------
---------------------------------------------------------------------------------------------------------------------------------
Income from discontinued operations, net of tax (Note 16)                       30,612               58,985               51,039
                                                                      -----------------    -----------------    -----------------
---------------------------------------------------------------------------------------------------------------------------------
Income before cumulative effect of changes in
   accounting principle, net of tax                                            106,881              185,230              381,954
                                                                      -----------------    -----------------    -----------------
---------------------------------------------------------------------------------------------------------------------------------
Cumulative effect of changes in accounting principle, net of tax                     -              (12,868)              16,708
                                                                      -----------------    -----------------    -----------------
---------------------------------------------------------------------------------------------------------------------------------
Net income                                                                    $106,881             $172,362             $398,662
                                                                      =================    =================    =================
---------------------------------------------------------------------------------------------------------------------------------
<PAGE>
Average number of common shares outstanding (basic)                             90,897               80,498               79,003
                                                                      =================    =================    =================
---------------------------------------------------------------------------------------------------------------------------------
Earnings per average common share (basic):
     Income from continuing operations                                           $0.84                $1.57                $4.19
     Income from discontinued operations                                          0.34                 0.73                 0.65
     Cumulative effect of changes in accounting principle                            -                (0.16)                0.21
                                                                      -----------------    -----------------    -----------------
     Net income                                                                  $1.18                $2.14                $5.05
                                                                      =================    =================    =================
---------------------------------------------------------------------------------------------------------------------------------
Average number of common shares outstanding (diluted)                           90,959               80,636               79,193
                                                                      =================    =================    =================
---------------------------------------------------------------------------------------------------------------------------------
Earnings per average common share (diluted):
     Income from continuing operations                                           $0.84                $1.57                $4.18
     Income from discontinued operations                                          0.34                 0.73                 0.64
     Cumulative effect of changes in accounting principle                            -                (0.16)                0.21
                                                                      -----------------    -----------------    -----------------
     Net income                                                                  $1.18                $2.14                $5.03
                                                                      =================    =================    =================
---------------------------------------------------------------------------------------------------------------------------------
Dividends declared per common share                                              $2.00                $2.00                $2.00
                                                                      =================    =================    =================
---------------------------------------------------------------------------------------------------------------------------------
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
</TABLE>

                                       59
<PAGE>
<TABLE>
<CAPTION>
                                            ALLIANT ENERGY CORPORATION
                                            CONSOLIDATED BALANCE SHEETS

                                                                                           December 31,
ASSETS                                                                               2002                2001
--------------------------------------------------------------------------------------------------------------------
                                                                                          (in thousands)
<S>                                                                                     <C>                 <C>
Property, plant and equipment:
  Utility:
    Electric plant in service                                                        $5,295,381          $5,123,781
    Gas plant in service                                                                613,122             597,494
    Other plant in service                                                              530,456             517,938
    Accumulated depreciation                                                         (3,573,407)         (3,374,867)
                                                                               -----------------    ----------------
      Net plant                                                                       2,865,552           2,864,346
    Construction work in progress                                                       263,096             111,069
    Other, net                                                                           68,340              62,194
                                                                               -----------------    ----------------
          Total utility                                                               3,196,988           3,037,609
                                                                               -----------------    ----------------
  Non-regulated and other, net:
    International                                                                       171,179             157,743
    Non-regulated generation                                                            156,699              60,411
    Integrated Services                                                                  73,983              79,202
    Investments                                                                          54,303              56,647
    Corporate Services and other                                                         76,055              50,566
                                                                               -----------------    ----------------
          Total non-regulated and other                                                 532,219             404,569
                                                                               -----------------    ----------------
                                                                                      3,729,207           3,442,178
                                                                               -----------------    ----------------
--------------------------------------------------------------------------------------------------------------------
Current assets:
  Cash and temporary cash investments                                                    63,872              68,400
  Restricted cash                                                                         9,686              34,421
  Accounts receivable:
    Customer, less allowance for doubtful accounts of $12,721 and $8,340                 81,277              43,411
    Unbilled utility revenues                                                            50,624              71,388
    Other, less allowance for doubtful accounts of $845 and $319                         60,107              72,912
  Income tax refunds receivable                                                          97,469              25,401
  Production fuel, at average cost                                                       63,126              54,707
  Materials and supplies, at average cost                                                58,603              54,401
  Gas stored underground, at average cost                                                62,797              57,114
  Regulatory assets                                                                      46,076              19,632
  Assets of discontinued operations (Note 16)                                           944,328             540,187
  Other                                                                                  76,183              66,882
                                                                               -----------------    ----------------
                                                                                      1,614,148           1,108,856
                                                                               -----------------    ----------------
--------------------------------------------------------------------------------------------------------------------
Investments:
  Investments in unconsolidated foreign entities                                        373,816             508,145
  Nuclear decommissioning trust funds                                                   344,892             332,953
  Investment in ATC and other                                                           217,992             243,804
                                                                               -----------------    ----------------
                                                                                        936,700           1,084,902
                                                                               -----------------    ----------------
--------------------------------------------------------------------------------------------------------------------
Other assets:
  Regulatory assets                                                                     302,365             241,973
  Deferred charges and other                                                            418,975             360,016
                                                                               -----------------    ----------------
                                                                                        721,340             601,989
                                                                               -----------------    ----------------
--------------------------------------------------------------------------------------------------------------------
Total assets                                                                         $7,001,395          $6,237,925
                                                                               =================    ================
--------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

</TABLE>
                                       60
<PAGE>
<TABLE>
<CAPTION>
                                           ALLIANT ENERGY CORPORATION
                                     CONSOLIDATED BALANCE SHEETS (Continued)

                                                                                         December 31,
CAPITALIZATION AND LIABILITIES                                                    2002                  2001
------------------------------------------------------------------------------------------------------------------
                                                                                         (in thousands)
<S>                                                                                    <C>                   <C>
Capitalization (See Consolidated Statements of Capitalization):
  Common stock - $0.01 par value - authorized 200,000,000 shares;
     outstanding 92,304,220 and 89,682,334 shares, respectively                        $923                  $897
  Additional paid-in capital                                                      1,293,919             1,239,793
  Retained earnings                                                                 758,187               832,293
  Accumulated other comprehensive loss                                             (209,943)             (152,434)
  Shares in deferred compensation trust - 239,467 and 71,958 shares
     at an average cost of $28.80 and $30.68 per share, respectively                 (6,896)               (2,208)
                                                                          ------------------    ------------------
       Total common equity                                                        1,836,190             1,918,341
                                                                          ------------------    ------------------

  Cumulative preferred stock of subsidiaries, net                                   205,063               113,953
  Long-term debt (excluding current portion)                                      2,637,803             2,457,941
                                                                          ------------------    ------------------
                                                                                  4,679,056             4,490,235
                                                                          ------------------    ------------------
------------------------------------------------------------------------------------------------------------------
Current liabilities:
  Current maturities and sinking funds                                               46,591                10,506
  Variable rate demand bonds                                                         55,100                55,100
  Commercial paper                                                                  195,500                68,389
  Other short-term borrowings                                                       113,721                84,318
  Accounts payable                                                                  286,690               221,823
  Accrued taxes                                                                     106,015                87,099
  Liabilities of discontinued operations (Note 16)                                  134,999                60,913
  Other                                                                             187,902               174,224
                                                                          ------------------    ------------------
                                                                                  1,126,518               762,372
                                                                          ------------------    ------------------
------------------------------------------------------------------------------------------------------------------
Other long-term liabilities and deferred credits:
  Accumulated deferred income taxes                                                 626,417               607,552
  Accumulated deferred investment tax credits                                        54,375                59,398
  Pension and other benefit obligations                                             181,010                96,496
  Environmental liabilities                                                          48,730                45,144
  Other                                                                             241,864               133,617
                                                                          ------------------    ------------------
                                                                                  1,152,396               942,207
                                                                          ------------------    ------------------
------------------------------------------------------------------------------------------------------------------
Minority interest                                                                    43,425                43,111
                                                                          ------------------    ------------------
------------------------------------------------------------------------------------------------------------------
Commitments and contingencies (Note 11)
------------------------------------------------------------------------------------------------------------------
Total capitalization and liabilities                                             $7,001,395            $6,237,925
                                                                          ==================    ==================
------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

</TABLE>
                                       61
<PAGE>
<TABLE>
<CAPTION>
                                                    ALLIANT ENERGY CORPORATION
                                               CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                                                               Year Ended December 31,
                                                                                     2002               2001             2000
-----------------------------------------------------------------------------------------------------------------------------------
                                                                                                     (in thousands)
<S>                                                                                       <C>               <C>              <C>
Cash flows from operating activities:
  Net income                                                                           $106,881          $172,362         $398,662
  Adjustments to reconcile net income to net cash flows from operating activities:
    Income from discontinued operations, net of tax                                     (30,612)          (58,985)         (51,039)
    Depreciation and amortization                                                       310,617           302,643          296,732
    Other amortizations                                                                  51,567            52,724           63,214
    Deferred tax expense (benefit) and investment tax (credit)                            9,145           (20,099)         111,103
    Losses (gains) on dispositions of assets, net                                           123            (4,446)         (11,780)
    Equity loss (income) from unconsolidated investments, net                            12,825           (18,799)         (19,468)
    Distributions from equity method investments                                         21,671            16,961            7,389
    Non-cash valuation charges                                                           66,379            33,706            2,897
    Cumulative effect of changes in accounting principle, net of tax                          -            12,868          (16,708)
    Gain on reclassification of investment                                                    -                 -         (321,349)
    Other                                                                               (29,594)           (5,297)          (2,922)
  Other changes in assets and liabilities:
    Accounts receivable                                                                   3,010            79,470         (133,776)
    Income tax refunds receivable                                                       (72,067)           (6,485)          (5,917)
    Gas stored underground                                                               (5,683)          (15,755)         (18,208)
    Accounts payable                                                                     38,788           (52,827)          96,012
    Accrued taxes                                                                        18,915            11,734            3,392
    Manufactured gas plants insurance refunds                                                 -           (21,541)               -
    Other                                                                                42,075           (52,123)          (5,144)
                                                                                  --------------   ---------------   --------------
       Net cash flows from operating activities                                         544,040           426,111          393,090
                                                                                  --------------   ---------------   --------------
-----------------------------------------------------------------------------------------------------------------------------------
Cash flows from financing activities:
    Common stock dividends                                                             (180,987)         (158,231)        (157,964)
    Proceeds from issuance of common stock                                               56,066           288,553            1,069
    Proceeds from issuance of preferred stock of subsidiary                             144,602                 -                -
    Redemption of preferred stock of subsidiary                                         (56,389)                -                -
    Net change in Resources' credit facility                                           (383,610)           63,110          181,652
    Proceeds from issuance of exchangeable senior notes                                       -                 -          402,500
    Proceeds from issuance of other long-term debt                                      300,023           513,530          107,747
    Reductions in other long-term debt                                                  (20,818)         (145,359)         (53,572)
    Net change in commercial paper and other short-term borrowings                      200,145          (320,449)         147,277
    Net change in loans to discontinued operations                                       49,320           (39,556)         (87,112)
    Other                                                                               (24,262)          (31,073)         (28,534)
                                                                                ----------------   ---------------   --------------
       Net cash flows from financing activities                                          84,090           170,525          513,063
                                                                                ----------------   ---------------   --------------
-----------------------------------------------------------------------------------------------------------------------------------
Cash flows used for investing activities:
    Construction and acquisition expenditures:
       Regulated domestic utilities                                                    (404,736)         (340,789)        (304,656)
       Non-regulated businesses                                                        (218,282)         (332,253)        (529,675)
       Corporate Services and other                                                     (33,774)          (40,019)         (11,123)
    Nuclear decommissioning trust funds                                                 (22,923)          (22,100)         (22,100)
    Proceeds from formation of ATC and other asset dispositions                          27,644           107,934           30,890
    Other                                                                                19,413           (29,035)         (32,589)
                                                                                ----------------   ---------------   --------------
       Net cash flows used for investing activities                                    (632,658)         (656,262)        (869,253)
                                                                                ----------------   ---------------   --------------
-----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash and temporary cash investments                           (4,528)          (59,626)          36,900
                                                                                ----------------   ---------------   --------------
-----------------------------------------------------------------------------------------------------------------------------------
Cash and temporary cash investments at beginning of period                               68,400           128,026           91,126
                                                                                ----------------   ---------------   --------------
-----------------------------------------------------------------------------------------------------------------------------------
Cash and temporary cash investments at end of period                                    $63,872           $68,400         $128,026
                                                                                ================   ===============   ==============
-----------------------------------------------------------------------------------------------------------------------------------
Supplemental cash flows information:
    Cash paid during the period for:
       Interest                                                                        $184,146          $180,356         $158,850
                                                                                ================   ===============   ==============
       Income taxes, net of refunds                                                     $29,359           $70,895         $117,226
                                                                                ================   ===============   ==============
    Noncash investing and financing activities:
       Capital lease obligations incurred and other                                     $19,101           $19,967          $20,419
                                                                                ================   ===============   ==============
-----------------------------------------------------------------------------------------------------------------------------------
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
</TABLE>
                                       62
<PAGE>
<TABLE>
<CAPTION>
                                                  ALLIANT ENERGY CORPORATION
                                           CONSOLIDATED STATEMENTS OF CAPITALIZATION

                                                                                                       December 31,
                                                                                                 2002                2001
--------------------------------------------------------------------------------------------------------------------------------
                                                                                           (in thousands, except share amounts)
<S>                                                                                                 <C>                 <C>
Common equity                                                                                    $1,836,190          $1,918,341
                                                                                           -----------------   -----------------
--------------------------------------------------------------------------------------------------------------------------------
Cumulative preferred stock of subsidiaries, net (Note 7(b))                                         205,063             113,953
                                                                                           -----------------   -----------------
--------------------------------------------------------------------------------------------------------------------------------
Long-term debt:
    First Mortgage Bonds:
      7.75%, due 2004                                                                                62,000              62,000
      1.85% variable rate at December 31, 2002 to 7.6% fixed rate, due 2005                          88,000              88,000
      7-1/4% to 8%, due 2007                                                                         52,450              52,450
      1.6% variable rate at December 31, 2002, due 2014                                               8,500               8,500
      1.85% to 2.1% variable rate at December 31, 2002, due 2015                                     30,600              30,600
      8-5/8%, due 2021                                                                               20,000              20,000
      7-5/8%, due 2023                                                                               94,000              94,000
      8.6%, due 2027                                                                                 70,000              70,000
                                                                                           -----------------   -----------------
                                                                                                    425,550             425,550
    Collateral Trust Bonds:
      7.25%, due 2006                                                                                60,000              60,000
      6-7/8%, due 2007                                                                               55,000              55,000
      6%, due 2008                                                                                   50,000              50,000
      5.5% to 7%, due 2023                                                                           69,400              69,400
                                                                                           -----------------   -----------------
                                                                                                    234,400             234,400
    Pollution Control Revenue Bonds:
      5.75% to 6.35%, partially retired in 2002, due 2003 to 2012                                    14,930              15,490
      2.8% variable rate at December 31, 2002 to 6.35% fixed rate, due 2003 to 2023                  10,100              10,100
      4.05% to 4.30% through 2004 fixed/variable rate, due 2005 to 2023                              25,900              25,900
                                                                                           -----------------   -----------------
                                                                                                     50,930              51,490
    Other long-term debt:
      Senior notes, 9.75%, due 2013                                                                 300,000                   -
      Senior notes, 7%, due 2011                                                                    300,000             300,000
      Senior notes, 7.375%, due 2009                                                                250,000             250,000
      Senior notes, 8.59%, due 2004                                                                  24,000              24,000
      Exchangeable senior notes, 7.25% through February 2003, 2.5% thereafter, due 2030             402,500             402,500
      Senior debentures, 6-5/8% to 6-3/4%, due 2009 to 2011                                         335,000             335,000
      Debentures, 5.7% to 7-5/8%, due 2007 to 2010                                                  265,000             265,000
      Whiting credit facility, 3.63% at December 31, 2002, due 2005                                 185,000                   -
      Subordinated deferrable interest debentures, 7-7/8%, due 2025                                  50,000              50,000
      Multifamily housing revenue bonds, 1.75% variable rate at December 31, 2002, due 2036          34,075              34,075
      Multifamily housing revenue bonds, 7% to 7.55%, due 2003 to 2024                                4,755               4,841
      Resources' credit facility, 3% to 3.45% at December 31, 2001, retired in 2002                       -             383,610
      Other, 1% to 11.34%, due 2003 to 2045                                                         251,841             116,814
                                                                                           -----------------   -----------------
                                                                                                  3,113,051           2,877,280
                                                                                           -----------------   -----------------
    Less:
      Current maturities                                                                            (46,591)            (10,506)
      Variable rate demand bonds                                                                    (55,100)            (55,100)
      Unamortized debt discount, net                                                               (373,557)           (353,733)
                                                                                           -----------------   -----------------
        Total long-term debt (excluding current portion)                                          2,637,803           2,457,941
                                                                                           -----------------   -----------------
--------------------------------------------------------------------------------------------------------------------------------
Total capitalization                                                                             $4,679,056          $4,490,235
                                                                                           =================   =================
--------------------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

</TABLE>
                                       63
<PAGE>
<TABLE>
<CAPTION>
                                                      ALLIANT ENERGY CORPORATION
                                         CONSOLIDATED STATEMENTS OF CHANGES IN COMMON EQUITY
                                                                                                  Accumulated
                                                                                                     Other      Shares in
                                                                              Additional         Comprehensive  Deferred      Total
                                                                     Common    Paid-In   Retained   Income    Compensation    Common
                                                                     Stock     Capital   Earnings   (Loss)        Trust       Equity
------------------------------------------------------------------------------------------------------------------------------------
                                                                                             (in thousands)
<S>                                                                     <C>       <C>        <C>        <C>       <C>         <C>
2000:
Beginning balance (a)                                                  $790    $942,408  $577,464   $634,903       $-    $2,155,565
   Net income                                                                             398,662                           398,662
      Unrealized holding losses on securities, net of tax of ($77,853)                              (105,292)              (105,292)
      Less: adjustment for gain on reclassification of investments
        included in net income, net of tax of $134,053                                               187,296                187,296
      Less: reclassification adjustment for other gains included
        in net income, net of tax of $8,426                                                           16,370                 16,370
                                                                                                   ----------           ------------
    Net unrealized losses on securities                                                             (308,958)              (308,958)
                                                                                                   ----------           ------------
    Foreign currency translation adjustments                                                         (50,400)               (50,400)
                                                                                                   ----------           ------------
      Unrealized holding losses on derivatives due to cumulative
        effect of a change in accounting principle, net of
          tax of ($4,693)                                                                             (6,582)                (6,582)
      Other unrealized holding losses on derivatives, net of
        tax of ($2,560)                                                                               (3,427)                (3,427)
      Less: reclassification adjustment for losses included
        in net income, net of tax of ($4,502)                                                         (6,331)                (6,331)
                                                                                                   ----------           ------------
    Net unrealized losses on qualifying derivatives                                                   (3,678)                (3,678)
                                                                                                   ----------           ------------
   Total comprehensive income                                                                                                35,626
 Common stock dividends                                                                  (157,964)                         (157,964)
 Common stock issued                                                              5,096                          (851)        4,245
                                                                 ----------- ----------- --------- ---------- --------  ------------
Ending balance                                                          790     947,504   818,162    271,867     (851)    2,037,472

2001:
   Net income                                                                             172,362                           172,362
      Unrealized holding losses on securities, net of
        tax of ($240,579)                                                                           (343,285)              (343,285)
      Less: reclassification adjustment for gains
        included in net income, net of tax of $--                                                        259                    259
                                                                                                   ----------           ------------
    Net unrealized losses on securities                                                             (343,544)              (343,544)
                                                                                                   ----------           ------------
    Foreign currency translation adjustments                                                         (66,830)               (66,830)
                                                                                                   ----------           ------------
    Minimum pension liability adjustments, net of tax of ($11,022)                                   (16,378)               (16,378)
                                                                                                   ----------           ------------
      Unrealized holding losses on derivatives, net of
        tax of ($1,569)                                                                               (1,003)                (1,003)
      Less: reclassification adjustment for losses included
        in net income, net of tax of ($2,078)                                                         (3,454)                (3,454)
                                                                                                   ----------           ------------
    Net unrealized gains on qualifying derivatives                                                     2,451                  2,451
                                                                                                   ----------           ------------
   Total comprehensive loss                                                                                                (251,939)
 Common stock dividends                                                                  (158,231)                         (158,231)
 Common stock issued                                                    107     292,289                        (1,357)      291,039
                                                                 ----------- ----------- --------- ---------- --------  ------------
Ending balance                                                          897   1,239,793   832,293   (152,434)  (2,208)    1,918,341

<PAGE>

2002:
   Net income                                                                             106,881                           106,881
      Unrealized holding losses on securities, net of tax of ($8,544)                                (11,069)               (11,069)
      Less: reclassification adjustment for losses
        included in net income, net of tax of ($14,393)                                              (23,146)               (23,146)
                                                                                                   ----------           ------------
    Net unrealized gains on securities                                                                12,077                 12,077
                                                                                                   ----------           ------------
    Foreign currency translation adjustments, net of tax                                             (37,785)               (37,785)
                                                                                                   ----------           ------------
    Minimum pension liability adjustments, net of tax of ($18,874)                                   (27,226)               (27,226)
                                                                                                   ----------           ------------
      Unrealized holding losses on derivatives, net of tax of ($2,765)                                (2,671)                (2,671)
      Less: reclassification adjustment for gains
        included in net income, net of tax of $1,658                                                   1,904                  1,904
                                                                                                   ----------           ------------
    Net unrealized losses on qualifying derivatives                                                   (4,575)                (4,575)
                                                                                                   ----------           ------------
   Total comprehensive income                                                                                                49,372
 Common stock dividends                                                                  (180,987)                         (180,987)
 Common stock issued                                                     26      58,338                        (4,688)       53,676
 Redemption of preferred stock of subsidiary                                     (4,212)                                     (4,212)
                                                                   --------- ----------- --------- ---------- --------  ------------
Ending balance                                                         $923  $1,293,919  $758,187  ($209,943) ($6,896)   $1,836,190
                                                                   ========= =========== ========= ========== ========  ============
------------------------------------------------------------------------------------------------------------------------------------
(a)  Accumulated other comprehensive income (loss) at December 31, 1999 consisted of $644,481 of net unrealized gains on securities
     and ($9,578) of foreign currency translation adjustments.

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

</TABLE>
                                       64
<PAGE>

                                ALLIANT ENERGY
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a)  General - The consolidated financial statements include the accounts of
Alliant Energy and its consolidated subsidiaries.  Alliant Energy is an
investor-owned public utility holding company, whose primary subsidiaries are
IP&L, WP&L, Resources and Corporate Services.  On Jan. 1, 2002, IPC merged
with and into IESU and IESU changed its name to IP&L.  Since IPC and IESU
were both wholly-owned operating subsidiaries of Alliant Energy, the
transaction had no impact on the consolidated financial statements.  IP&L and
WP&L are utility subsidiaries that are engaged principally in the generation,
transmission, distribution and sale of electric energy; the purchase,
distribution, transportation and sale of natural gas; and the provision of
steam and water services in Iowa, Wisconsin, Minnesota and Illinois.
Resources (through its numerous direct and indirect subsidiaries) is
comprised of various business units:  International, Non-regulated
Generation, Integrated Services, Investments and Energy Technologies.
International holds interests in global partnerships to develop energy
generation, delivery and infrastructure in growing international markets,
including Australia, Brazil, China and New Zealand.  Alliant Energy is,
however, currently in the process of selling its investments in Australia.
Non-regulated Generation intends to build or acquire a portfolio of
competitive electric generating assets in select business areas of the U.S.
Integrated Services provides a wide range of energy and environmental
services for commercial, industrial, institutional, educational and
governmental customers.  Investments includes ownership of an oil and gas
production company, transportation companies, affordable-housing properties
and various other investments.  Alliant Energy is, however, currently in the
process of selling its oil and gas and affordable housing businesses.  Energy
Technologies invests in leading-edge energy technologies, such as
microturbines, fuel cells, solar concepts and wind turbines.  Mass Marketing
has interests in energy marketing businesses.  In January 2003, Alliant
Energy committed to a plan to sell SmartEnergy, an internet-based energy
retailer, and Alliant Energy is in the process of disbanding its Mass
Marketing business unit.  Corporate Services is the subsidiary formed to
provide administrative services to Alliant Energy and its subsidiaries as
required under PUHCA.

At Dec. 31, 2002, the assets and liabilities of Alliant Energy's oil and gas
(Whiting), Australian (including Southern Hydro) and affordable housing
businesses were classified as held for sale.  The operating results for these
non-regulated businesses for all periods presented have been separately
classified and reported as discontinued operations in Alliant Energy's
Consolidated Financial Statements and Notes to Consolidated Financial
Statements.  Refer to Note 16 for additional information.

The consolidated financial statements reflect investments in controlled
subsidiaries on a consolidated basis.  All significant intercompany balances
and transactions, other than certain energy-related transactions affecting
the utility subsidiaries, have been eliminated from the consolidated
financial statements.  Such energy-related transactions not eliminated are
made at prices that approximate market value and the associated costs are
recoverable from customers through the rate making process.  The consolidated
financial statements are prepared in conformity with GAAP, which give
recognition to the rate making and accounting practices of FERC and state
commissions having regulatory jurisdiction.  The preparation of the
consolidated financial statements requires management to make estimates and
assumptions that affect: a) the reported amounts of assets and liabilities
and the disclosure of contingent assets and liabilities at the date of the
financial statements; and b) the reported amounts of revenues and expenses
during the reporting period.  Actual results could differ from those
estimates.  Certain prior period amounts have been reclassified on a basis
consistent with the current year presentation.

Unconsolidated investments for which Alliant Energy has at least a 20%
non-controlling voting interest are generally accounted for under the equity
method of accounting.  These investments are stated at acquisition cost,
increased or decreased for Alliant Energy's equity in net income or loss,
which is included in "Equity (income) loss from unconsolidated investments"
in the Consolidated Statements of Income and decreased for any dividends
received.  These investments are also increased or decreased for Alliant
Energy's proportionate share of the investee's other comprehensive income
(loss), which is included in "Accumulated other comprehensive loss" on the
Consolidated Balance Sheets.  Investments that do not meet the criteria for
consolidation or the equity method of accounting are accounted for under the
cost method.  Refer to Note 9 for discussion of Alliant Energy's cost method
investments that are marked-to-market in accordance with SFAS 115.

                                       65
<PAGE>
(b)  Regulation - Alliant Energy is a registered public utility holding
company subject to regulation by the SEC under PUHCA.  The utility
subsidiaries are subject to regulation under PUHCA, FERC and their respective
state regulatory commissions.

(c)  Regulatory Assets and Liabilities - Alliant Energy is subject to the
provisions of SFAS 71, "Accounting for the Effects of Certain Types of
Regulation," which provides that rate-regulated public utilities record
certain costs and credits allowed in the rate making process in different
periods than for non-regulated entities.  These are deferred as regulatory
assets or accrued as regulatory liabilities and are recognized in the
Consolidated Statements of Income at the time they are reflected in rates.
As of Dec. 31, 2002, IP&L and WP&L had approximately $7 million and $6
million, respectively, of regulatory assets that were not earning returns.
At Dec. 31, 2002 and 2001, regulatory assets and liabilities were comprised
of the following items (in millions):

<TABLE>
<CAPTION>
                                         Regulatory Assets          Regulatory Liabilities
                                       -----------------------     -------------------------
                                         2002          2001           2002          2001
                                       ----------    ---------     -----------    ----------
<S>                                       <C>           <C>            <C>            <C>
Tax-related (Note 1(d))                  $177.6        $115.3         $83.8          $15.1
Environmental-related                      64.9          63.1           5.1            5.2
Energy efficiency program costs            46.7          39.9          --             --
Other                                      59.2          43.3          22.3           11.4
                                       ----------    ---------     -----------    ----------
                                         $348.4        $261.6        $111.2          $31.7
                                       ==========    =========     ===========    ==========
</TABLE>

If a portion of the utility subsidiaries' operations becomes no longer
subject to the provisions of SFAS 71 as a result of competitive restructuring
or otherwise, a write-down of related regulatory assets would be required,
unless some form of transition cost recovery is established by the
appropriate regulatory body that would meet the requirements under GAAP for
continued accounting as regulatory assets during such recovery period.  In
addition, each utility subsidiary would be required to determine any
impairment of other assets and write-down such assets to their fair value.

(d)  Income Taxes - Alliant Energy is subject to the provisions of SFAS 109,
"Accounting for Income Taxes," and follows the liability method of accounting
for deferred income taxes, which requires the establishment of deferred tax
assets and liabilities, as appropriate, for all temporary differences between
the tax basis of assets and liabilities and the amounts reported in the
consolidated financial statements.  Deferred taxes are recorded using
currently enacted tax rates.

Except as noted below, income tax expense includes provisions for deferred
taxes to reflect the tax effects of temporary differences between the time
when certain costs are recorded in the accounts and when they are deducted
for tax return purposes.  As temporary differences reverse, the related
accumulated deferred income taxes are reversed to income.  Investment tax
credits have been deferred and are subsequently credited to income over the
average lives of the related property.  Other tax credits reduce income tax
expense in the year claimed and are generally related to nonconventional fuel
and research and development.

Consistent with Iowa rate making practices for IP&L, deferred tax expense is
not recorded for certain temporary differences (primarily related to utility
property, plant and equipment).  As the deferred taxes become payable (over
periods exceeding 30 years for some generating plant differences) they are
recovered through rates.  Accordingly, IP&L has recorded deferred tax
liabilities and regulatory assets for certain temporary differences, as
identified in Note 1(c).  In Wisconsin, the PSCW has allowed rate recovery of
deferred taxes on all temporary differences since August 1991.  WP&L
established a regulatory asset associated with those temporary differences
occurring prior to August 1991 that will be recovered in future rates through
2007.

(e)  Common Shares Outstanding - A reconciliation of the weighted average
common shares outstanding used in the basic and diluted earnings per share
calculation was as follows:

<TABLE>
<CAPTION>

Weighted average common shares outstanding:             2002              2001              2000
                                                    --------------    -------------     -------------
      <S>                                                 <C>              <C>               <C>
      Basic earnings per share calculation             90,896,885       80,497,823        79,002,643
      Effect of dilutive securities                        62,177          138,006           190,134
                                                    --------------    -------------     -------------
      Diluted earnings per share calculation           90,959,062       80,635,829        79,192,777
                                                    ==============    =============     =============
</TABLE>
                                       66
<PAGE>

In 2002, 2001 and 2000, 3,338,978, 1,501,854, and 1,358,597 options,
respectively, to purchase shares of common stock, with average exercise
prices of $29.67, $31.08, and $30.27, respectively, were excluded from the
calculation of diluted earnings per share as the exercise prices were greater
than the average market price.

(f)  Temporary Cash Investments and Restricted Cash - Temporary cash
investments are stated at cost, which approximates market value, and are
considered cash equivalents for the Consolidated Balance Sheets and the
Consolidated Statements of Cash Flows.  These investments consist of
short-term liquid investments that have maturities of less than 90 days from
the date of acquisition.  At Dec. 31, 2002 and 2001, restricted cash was
primarily related to borrowing requirements for the construction of various
power plants in China.

(g) Depreciation of Utility Property, Plant and Equipment - The utility
subsidiaries use a combination of remaining life, straight-line and
sum-of-the-years-digits depreciation methods as approved by their respective
regulatory commissions.  The remaining life of DAEC, of which IP&L is a
co-owner, is based on the NRC license end-of-life of 2014.  The remaining
depreciable life of Kewaunee, of which WP&L is a co-owner, is based on the
PSCW approved revised end-of-life of 2010.  Depreciation expense related to
the decommissioning of DAEC and Kewaunee is discussed in Note 11(f).  The
average rates of depreciation for electric and gas properties, consistent
with current rate making practices, were as follows:

<TABLE>
<CAPTION>
                             IP&L                                 WP&L
               ---------------------------------    ---------------------------------
                 2002        2001       2000          2002        2001       2000
               ---------- ----------- ----------    ---------- ----------- ----------
<S>              <C>         <C>        <C>           <C>         <C>        <C>
Electric         3.4%        3.5%       3.5%          3.6%        3.7%       3.6%
Gas              2.9%        3.6%       3.5%          4.1%        4.1%       4.1%

</TABLE>

(h) Property, Plant and Equipment - Utility plant (other than acquisition
adjustments) is recorded at original cost, which includes overhead,
administrative costs and AFUDC.  At Dec. 31, 2002 and 2001, IP&L had $22.0
million and $23.2 million, respectively, of acquisition adjustments, net of
accumulated amortization, included in utility plant ($4.9 million and $5.2
million, respectively, of such balances are currently being recovered in
IP&L's rates).  The aggregate gross AFUDC recovery rates, computed in
accordance with the prescribed regulatory formula, were as follows:

         2002     2001     2000
        -------  -------  -------
IP&L     6.9%     7.7%      6.6%
WP&L     2.6%     7.9%     10.8%

Non-regulated property, plant and equipment is recorded at original cost.
The majority of the non-regulated property, plant and equipment is
depreciated using the straight-line method over periods ranging from five to
20 years.  Upon retirement or sale of property and equipment, the cost and
related accumulated depreciation are removed from the accounts and any gain
or loss is included in "Miscellaneous, net" in the Consolidated Statements of
Income.  Ordinary retirements of utility plant, including removal costs less
salvage value, are charged to accumulated depreciation upon removal from
utility plant accounts and no gain or loss is recognized.

(i)  Operating Revenues - Revenues from IP&L and WP&L are primarily from the
sale and delivery of electricity and natural gas and are recorded under the
accrual method of accounting and recognized upon delivery.  Revenues from
Alliant Energy's non-regulated businesses are primarily from the sale of
energy or services and are recognized based on output delivered or services
provided as specified under contract terms.  Alliant Energy accrues revenues
for services rendered but unbilled at month-end.  In 2000, Alliant Energy
recorded an increase of $10 million at WP&L in the estimate of utility
services rendered but unbilled at month-end due to the implementation of
refined estimation processes.

(j)  Utility Fuel Cost Recovery - IP&L's retail tariffs provide for
subsequent adjustments to its electric and natural gas rates for changes in
the cost of fuel, purchased energy and natural gas purchased for resale.
Changes in the under/over collection of these costs are reflected in
"Electric and steam production fuels" and "Cost of utility gas sold" in the
Consolidated Statements of Income.  The cumulative effects are reflected on
the Consolidated Balance Sheets as a current regulatory asset or liability,
pending automatic reflection in future billings to customers.  At IP&L,
purchased-power capacity costs are not recovered from electric customers
through EACs.  Recovery of these costs must be addressed in base rates in a
formal rate proceeding.

WP&L's retail electric rates are based on annual forecasted fuel and
purchased-power costs.  Under PSCW rules, WP&L can seek emergency rate
increases if the annual costs are more than 3% higher than the estimated

                                       67
<PAGE>

costs used to establish rates.  Any collections in excess of costs incurred
will be refunded, with interest.  Accordingly, WP&L has established a reserve
due to overcollection of past fuel and purchased-power costs and expects to
refund such amount in 2003.  WP&L has a gas performance incentive which
includes a sharing mechanism whereby 50% of all gains and losses relative to
current commodity prices, as well as other benchmarks, are retained by WP&L,
with the remainder refunded to or recovered from customers.

(k)  Nuclear Refueling Outage Costs - The IUB allows IP&L to collect, as part
of its base revenues, funds to offset other operation and maintenance
expenditures incurred during refueling outages at DAEC.  As these revenues
are collected, an equivalent amount is charged to other operation and
maintenance expense with a corresponding credit to a reserve.  During a
refueling outage, the reserve is reversed to offset the refueling outage
expenditures.  Operating expenses incurred during refueling outages at
Kewaunee are expensed by WP&L as incurred.  Scheduled refueling outages
occurred most recently at DAEC and Kewaunee in Spring and late 2001,
respectively.  The next scheduled refueling outages at DAEC and Kewaunee are
anticipated to commence in Spring 2003.

(l)  Nuclear Fuel - Nuclear fuel for DAEC is leased.  Annual nuclear fuel
lease expenses include the cost of fuel, based on the quantity of heat
produced for the generation of electricity, plus the lessor's interest costs
related to fuel in the reactor and administrative expenses.  Nuclear fuel for
Kewaunee is recorded at its original cost and is amortized to expense based
upon the quantity of heat produced for the generation of electricity.  This
accumulated amortization assumes spent nuclear fuel will have no residual
value.  Estimated future disposal costs of such fuel are expensed based on
KWhs generated.  Refer to Note 3 for additional information on DAEC's nuclear
fuel lease.

(m)  Translation of Foreign Currency - Assets and liabilities of
international investments, where the local currency is the functional
currency, have been translated at year-end exchange rates and related income
statement results have been translated using average exchange rates
prevailing during the year.  Adjustments resulting from translation,
including gains and losses on intercompany foreign currency transactions
which are long-term in nature, and which Alliant Energy does not intend to
settle in the foreseeable future, have been recorded in "Accumulated other
comprehensive loss" on Alliant Energy's Consolidated Balance Sheets.

(n)  Derivative Financial Instruments - Alliant Energy uses derivative
financial instruments to hedge exposures to fluctuations in interest rates,
certain electric and gas commodity prices and volatility in a portion of
natural gas sales volumes due to weather.  Alliant Energy also utilizes
derivatives to mitigate the equity price volatility associated with certain
investments in equity securities.  Alliant Energy does not use such
instruments for speculative purposes.  The fair value of all derivatives are
recorded as assets or liabilities on the Consolidated Balance Sheets and
gains and losses related to derivatives that are designated as, and qualify
as hedges, are recognized in earnings when the underlying hedged item or
physical transaction is recognized in income.  Gains and losses related to
derivatives that do not qualify for, or are not designated in hedge
relationships, are recognized in earnings immediately.  The majority of
Alliant Energy's derivative transactions are in its regulated domestic
utility business and based on the fuel and natural gas cost recovery
mechanisms in place, as well as other specific regulatory authorizations,
changes in fair market values of such derivatives generally have no impact on
Alliant Energy's results of operations.  Alliant Energy has a number of
commodity purchase and sales contracts that have been designated, and qualify
for, the normal purchase and sale exception in SFAS 138, "Accounting for
Certain Derivative Instruments and Certain Hedging Activities - an Amendment
of SFAS 133."  Based on this designation, these contracts are not accounted
for as derivative instruments.

Alliant Energy is exposed to losses related to financial instruments in the
event of counterparties' non-performance.  Alliant Energy has established
controls to determine and monitor the creditworthiness of counterparties in
order to mitigate its exposure to counterparty credit risk.  Alliant Energy
is not aware of any material exposure to counterparty credit risk.  Refer to
Note 10 for further discussion of Alliant Energy's derivative financial
instruments.

(o)  Accounting for Stock Options - At Dec. 31, 2002, Alliant Energy had two
stock-based incentive compensation plans, which are described more fully in
Note 6(b).  Alliant Energy accounts for stock options issued under these
plans under the recognition and measurement principles of APB 25, "Accounting
for Stock Issued to Employees."  No stock-based compensation cost is
reflected in net income in Alliant Energy's Consolidated Statements of
Income, as all options granted under those plans had an exercise price equal
to the quoted market price of the underlying common stock on the date of
grant.  Alliant Energy adopted the disclosure provisions of SFAS 148
"Accounting for Stock-Based Compensation - Transition and Disclosure, an
amendment of SFAS 123," effective for financial statements for fiscal years

                                       68
<PAGE>

ending after Dec. 15, 2002.  The effect on net income and EPS if Alliant
Energy had applied the fair value recognition provisions of SFAS 123,
"Accounting for Stock-Based Compensation," to the stock options issued under
these plans was as follows (in thousands):

<TABLE>
<CAPTION>
                                                            2002           2001           2000
                                                        -------------  -------------  -------------
<S>                                                           <C>          <C>             <C>
Net income, as reported                                     $106,881     $172,362        $398,662
Less:  stock-based compensation expense, net of tax            2,541        2,446           1,284
                                                        -------------  -------------  -------------
Pro forma net income                                        $104,340     $169,916        $397,378
                                                        =============  =============  =============

EPS (basic):
   As reported                                                $1.18         $2.14          $5.05
   Pro forma                                                  $1.15         $2.11          $5.03
EPS (diluted):
   As reported                                                $1.18         $2.14          $5.03
   Pro forma                                                  $1.15         $2.11          $5.02

</TABLE>

(p)  Pension Plan - For the defined benefit pension plan sponsored by
Corporate Services, Alliant Energy allocates pension costs and contributions
to IP&L, WP&L, Resources and the parent company based on labor costs of plan
participants and any additional minimum pension liability based on each
group's funded status.

(q) Asset Valuations - Long-lived assets, excluding goodwill and regulatory
assets,  are  reviewed  for possible  impairment  whenever  events or changes in
circumstances  indicate the carrying value of the assets may not be recoverable.
Impairment  is  indicated  if  the  carrying  value  of  an  asset  exceeds  its
undiscounted  future cash flows. An impairment charge is recognized equal to the
amount the  carrying  value  exceeds the asset's  fair value.  The fair value is
determined by the use of quoted market prices,  appraisals,  or the use of other
valuation techniques such as expected discounted future cash flows.

Goodwill represents the excess of the purchase price over the fair value of
the  identifiable  net tangible  and  intangible  assets  acquired in a business
combination.  Effective January 1, 2002 with the adoption of SFAS 142, "Goodwill
and  Other  Intangible  Assets,"  goodwill  is  required  to  be  evaluated  for
impairment  at least  annually and more  frequently  if indicators of impairment
exist.  If the fair value of a reporting  unit is less than its carrying  value,
including  goodwill,  an impairment  charge may be necessary.  The fair value of
reporting  units is  determined  by  utilizing  a  combination  of market  value
indicators  and  expected  discounted  future cash  flows.  Refer to Note 14 for
additional information.

If events or circumstances indicate the carrying value of investments
accounted for under the equity method of accounting may not be recoverable,
potential impairment is assessed by comparing the future anticipated cash
flows from these investments to their carrying values.  The estimated fair
value less cost to sell of assets held for sale are compared each reporting
period to their carrying values.  Impairment charges are recorded for equity
method investments and assets held for sale if the carrying value of such
asset exceeds the future anticipated cash flows or the estimated fair value
less cost to sell, respectively.

(2)  UTILITY RATE MATTERS
In 2002, IP&L filed electric and gas rate cases in Iowa.  Interim rates,
subject to refund, were granted for $15 million and $17 million for electric
and gas, respectively.  IP&L expects final rates to be in place in June 2003
for the electric case and July 2003 for the gas case.  Although it is
possible that final rates could be lower than interim rates, IP&L does not
believe this to be probable and therefore has not recorded any reserves
related to potential refund obligations.

In 2002 and 2001, WP&L had an electric fuel cost recovery mechanism that
required WP&L to refund any overcollection of fuel and purchased-power
costs.  WP&L has recorded the necessary reserve for refunds at Dec. 31, 2002
and 2001.  In 2002, WP&L filed a rate case with FERC related to its electric
wholesale customers.  An interim rate increase, subject to refund, of $6
million annually was granted effective April 2002.  The case was subsequently
settled with final rates of $3 million annually.  At Dec. 31, 2002, WP&L
recorded a reserve for the difference between interim and final rates.

                                       69
<PAGE>

(3)  LEASES
IP&L has a capital lease covering its 70% undivided interest in nuclear fuel
purchased for DAEC.  Annual nuclear fuel lease expenses (included in
"Electric and steam production fuels" in the Consolidated Statements of
Income) for 2002, 2001 and 2000 were $15.5 million, $14.1 million and $16.0
million, respectively.  Alliant Energy's operating lease rental expenses,
which include certain purchased-power agreements, for 2002, 2001 and 2000
were $45.1 million, $40.4 million and $24.5 million, respectively.  The
purchased-power agreements total below includes $463 million and $78 million,
respectively, related to a new plant (Riverside) currently under development
and the RockGen plant, both in Wisconsin.  The Riverside plant is expected to
be placed in-service in 2004.  The synthetic leases relate to the financing
of the corporate headquarters, corporate aircraft, utility railcars and a
utility radio dispatch system that were not included on Alliant Energy's
Consolidated Balance Sheets.  Alliant Energy has guaranteed the residual
value of its synthetic leases totaling $76 million in the aggregate.  The
guarantees extend through the maturity of each respective underlying lease
with remaining terms up to 13 years.  Residual value guarantees have been
included in the future minimum lease payments noted in the table below (in
millions):

<TABLE>
<CAPTION>
                                              2003     2004     2005      2006     2007   Thereafter    Total
                                            --------------------------------------------------------------------
<S>                                            <C>      <C>      <C>       <C>     <C>       <C>         <C>
Operating leases:
  Certain purchased-power agreements          $18.7    $51.8    $66.3     $67.6   $69.0     $308.6      $582.0
  Synthetic leases                             10.0     12.1     19.3      24.6    49.0       31.0       146.0
  Other                                        16.3     12.2      9.3       6.3     5.2       44.2        93.5
                                            --------------------------------------------------------------------
Total operating leases                        $45.0    $76.1    $94.9     $98.5  $123.2     $383.8      $821.5
                                            ====================================================================
</TABLE>

<TABLE>
<CAPTION>
                                                                                                         Present
                                                                                           Less:       value of net
                                                                                           amount        minimum
                                                                                         representing  capital lease
                        2003    2004     2005     2006    2007    Thereafter    Total      interest      payments
                      ------- -------- -------- ------- -------- ------------ -------- -------------- --------------
<S>                     <C>      <C>       <C>    <C>       <C>       <C>         <C>        <C>            <C>
Capital leases         $15.1    $15.8     $9.8   $35.5     $1.7      $1.2        $79.1      $9.3           $69.8

</TABLE>

In January 2003, the FASB issued FIN 46 which addresses consolidation by
business enterprises of variable interest entities, commonly referred to as
"special purpose entities."  FIN 46 requires consolidation where there is a
controlling financial interest in a variable interest entity or where the
variable interest entity does not have sufficient equity at risk to finance
its activities without additional subordinated financial support from other
parties.  Alliant Energy will apply the provisions of FIN 46 prospectively
for all variable interest entities created after Jan. 31, 2003.  For variable
interest entities created before Jan. 31, 2003, Alliant Energy will be
required to consolidate all variable interest entities in which it is the
primary beneficiary beginning in the third quarter of 2003.  It is reasonably
possible the implementation of FIN 46 will require that certain variable
interest entities associated with these synthetic leases be included on
Alliant Energy's Consolidated Balance Sheets.  Alliant Energy is in the
process of analyzing each synthetic lease in accordance with FIN 46.  Alliant
Energy does not anticipate the adoption of FIN 46 will have a material impact
on its results of operations given it estimates the fair market value of the
underlying assets is not materially less than the remaining lease obligations
at Dec. 31, 2002.

(4)  UTILITY ACCOUNTS RECEIVABLE
Utility customer accounts receivable, including unbilled revenues, arise
primarily from the sale of electricity and natural gas.  At Dec. 31, 2002 and
2001, the utility subsidiaries were serving a diversified base of
residential, commercial and industrial customers and did not have any
significant concentrations of credit risk.

Alliant Energy's utility subsidiaries participate in a combined utility
customer accounts receivable sale program whereby IP&L and WP&L may sell up
to a combined maximum amount of $250 million (there are no individual
subsidiary limits) of their respective accounts receivable to a third-party
financial institution on a limited recourse basis through wholly-owned and
consolidated variable interest entities.  Corporate Services acts as a
collection agent for the buyer and receives a fee for collection services
that approximates fair value.  The agreement expires in April 2006 and is
subject to annual renewal or renegotiation for a longer period thereafter.
Under terms of the agreement, the third-party financial institution purchases
the receivables initially for the face amount.  On a monthly basis, this
sales price is adjusted, resulting in payments to the third-party financial
institution of an amount that varies based on interest rates and length of
time the sold receivables remain outstanding.  Collections on sold
receivables are used to purchase additional receivables from the utility
subsidiaries.

                                       70
<PAGE>

At Dec. 31, 2002 and 2001, Alliant Energy had sold $202 million and $178
million of receivables, respectively.  In 2002, 2001 and 2000, Alliant Energy
received $2.3 billion, $2.2 billion and $1.6 billion, respectively, in
aggregate proceeds from the sale of accounts receivable.  The utility
subsidiaries use proceeds from the sale of accounts receivable and unbilled
revenues to maintain flexibility in their capital structures, take advantage
of favorable short-term rates and finance a portion of their long-term cash
needs.  Alliant Energy paid fees associated with these sales of $4.2 million,
$7.9 million and $9.0 million in 2002, 2001 and 2000, respectively.

Alliant Energy and its utility subsidiaries account for the sale of accounts
receivable to the third-party financial institution as sales under SFAS 140,
"Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities."  Retained receivables are available to the
third-party financial institution to pay any fees or expenses due it, and to
absorb all credit losses incurred on any of the sold receivables.  Beginning
in the third quarter of 2003 under FIN 46, it is reasonably possible that
Alliant Energy could be considered the primary beneficiary given the current
structure of the variable interest entities related to the program, and could
be required to consolidate the operating results and associated assets and
liabilities of the variable interest entities in its financial statements.
Based on the receivables sold at Dec. 31, 2002, consolidation of the variable
interest entities would have resulted in an additional $202 million in
accounts receivable and related debt recorded on Alliant Energy's
Consolidated Balance Sheet.  Alliant Energy is currently evaluating the
structure of its receivable sales program to determine if this structure can
be modified to qualify for off-balance sheet treatment under FIN 46.

(5)  INCOME TAXES
The components of income taxes for Alliant Energy were as follows (in
millions):

<TABLE>
<CAPTION>
                                                 2002             2001              2000
                                             -------------    -------------     -------------
<S>                                               <C>              <C>               <C>
Current tax expense:
  Federal                                         $19.4            $51.3             $92.1
  State                                            21.6             16.2              24.0
Deferred tax expense (benefit):
  Federal                                          16.8             (9.3)             97.6
  State                                            (2.5)            (5.6)             18.0
Foreign tax expense                                 5.5              4.2               0.2
Amortization of investment tax credits             (5.2)            (5.2)             (4.5)
Research and development tax credits               (4.5)            --                --
Nonconventional fuel credits                      (14.9)            (0.5)             (0.9)
Other tax credits                                  (0.1)            (0.3)             (0.3)
                                             -------------    -------------     -------------
                                                  $36.1            $50.8            $226.2
                                             =============    =============     =============
</TABLE>

Included in "Cumulative effect of changes in accounting principle, net of
tax" in the Consolidated Statements of Income for 2001 and 2000 was income tax
(benefit) expense of ($5.5) million and $9.8 million, respectively, related
to the adoption of SFAS 133 by an equity method foreign affiliate of Alliant
Energy on Jan. 1, 2001 and by Alliant Energy's consolidated subsidiaries on
July 1, 2000, respectively.

The overall effective income tax rates shown in the following table were
computed by dividing total income tax expense by income from continuing
operations before income taxes and preferred dividend requirements of
subsidiaries.

<TABLE>
<CAPTION>
                                                                  2002              2001             2000
                                                              -------------     -------------    --------------
<S>                                                               <C>               <C>              <C>
Statutory federal income tax rate                                 35.0%             35.0%            35.0%
    State income taxes, net of federal benefits                    9.7               5.6              6.6
    Foreign operations                                             7.4              (0.8)            --
    Adjustment of prior period taxes                               1.0             (11.6)            (0.6)
    Effect of rate making on property related differences          0.1               2.3              0.9
    Research and development tax credits                          (3.8)             --               --
    Amortization of investment tax credits                        (4.4)             (3.1)            (1.0)
    Nonconventional fuel credits                                 (12.6)             (0.3)            (0.2)
    Other items, net                                              (1.9)              0.5             (0.6)
                                                              -------------     -------------    --------------
Overall effective income tax rate                                 30.5%             27.6%            40.1%
                                                              =============     =============    ==============
</TABLE>

                                       71
<PAGE>

The accumulated deferred income tax (assets) and liabilities included on the
Consolidated Balance Sheets at Dec. 31 arise from the following temporary
differences (in millions):
                                      2002              2001
                                  -------------     -------------
Property related                      $647.2            $548.8
Exchangeable senior notes              140.8             129.7
Decommissioning                        (33.1)            (28.6)
Other                                 (128.5)            (42.3)
                                  -------------     -------------
                                      $626.4            $607.6
                                  =============     =============

At Dec. 31, 2002, 2001 and 2000, Alliant Energy had not recorded U.S. tax
provisions of approximately $16.3 million, $6.8 million and $3.8 million,
respectively, relating to approximately $46.6 million, $19.5 million and
$10.9 million, respectively, of unremitted earnings from foreign investments
as these earnings are expected to be reinvested indefinitely.

U.S. and foreign sources of income (loss) from continuing operations before
income taxes were as follows (in millions):

<TABLE>
<CAPTION>
                                                               2002          2001          2000
                                                           ------------- -------------  ------------
<S>                                                              <C>           <C>           <C>
U.S. sources                                                   $115.3        $156.0        $543.7
Foreign sources                                                  (2.9)         21.0          13.4
                                                           ------------- -------------  ------------
  Income from continuing operations before income taxes        $112.4        $177.0        $557.1
                                                           ============= =============  ============
</TABLE>

(6)  BENEFIT PLANS
(a)  Pension Plans and Other Postretirement Benefits - Alliant Energy has
several non-contributory defined benefit pension plans that cover a
significant number of its employees.  Benefits are based on the employees'
years of service and compensation.  Alliant Energy also provides certain
postretirement health care and life benefits to eligible retirees.  In
general, the health care plans are contributory with participants'
contributions adjusted regularly and the life insurance plans are
non-contributory.  The weighted-average assumptions at the measurement date
of Sept. 30 were as follows:

<TABLE>
<CAPTION>
                                             Qualified Pension Benefits            Other Postretirement Benefits
                                        --------------------------------------  ------------------------------------
                                           2002          2001         2000        2002        2001          2000
                                        ------------ ------------- -----------  ----------  ----------   -----------
<S>                                        <C>          <C>          <C>          <C>         <C>          <C>
Discount rate                              6.75%        7.25%        8.00%        6.75%       7.25%        8.00%
Expected return on plan assets              9%            9%           9%          9%          9%            9%
Rate of compensation increase            3.5-4.5%      3.5-4.5%     3.5-4.5%      3.5%        3.5%          3.5%
Medical cost trend on covered charges:
   Initial trend rate                       N/A          N/A          N/A         10.8%       12.0%         9.0%
   Ultimate trend rate                      N/A          N/A          N/A          5%          5%            5%

</TABLE>

The components of Alliant Energy's qualified pension benefits and other
postretirement benefits costs were as follows (in millions):

<TABLE>
<CAPTION>
                                               Qualified Pension Benefits            Other Postretirement Benefits
                                           ------------------------------------    ----------------------------------
                                             2002          2001         2000         2002        2001         2000
                                           ----------    ----------    --------    ---------   ---------    ---------
<S>                                           <C>           <C>          <C>          <C>         <C>          <C>
Service cost                                 $12.9         $11.0        $11.1        $5.5        $4.0         $3.7
Interest cost                                 39.7          38.2         36.7        12.7        10.6          9.8
Expected return on plan assets               (41.8)        (48.5)       (45.7)       (5.5)       (6.1)        (5.3)
Amortization of:
   Transition obligation (asset)              (2.0)         (2.4)        (2.4)        3.7         3.7          3.9
   Prior service cost                          2.7           2.7          2.6        (0.3)       (0.3)        (0.3)
   Actuarial loss (gain)                       2.1          (1.5)        (1.0)        0.5        (1.5)        (1.9)
                                           ----------    ----------    --------    ---------   ---------    ---------
                                             $13.6         ($0.5)        $1.3       $16.6       $10.4         $9.9
                                           ==========    ==========    ========    =========   =========    =========
</TABLE>
                                       72
<PAGE>

The assumed medical trend rates are critical assumptions in determining the
service and interest cost and accumulated postretirement benefit obligation
related to postretirement benefit costs.  A 1% change in the medical trend
rates for 2002, holding all other assumptions constant, would have the
following effects (in millions):

<TABLE>
<CAPTION>
                                                            1% Increase        1% Decrease
                                                           --------------     ---------------
<S>                                                              <C>                <C>
Effect on total of service and interest cost components          $1.9               ($1.7)
Effect on postretirement benefit obligation                     $19.4              ($17.3)

</TABLE>

A reconciliation of the funded status of Alliant Energy's plans to the
amounts recognized on Alliant Energy's Consolidated Balance Sheets at Dec. 31
was as follows (in millions):

<TABLE>
<CAPTION>
                                                        Qualified Pension Benefits       Other Postretirement Benefits
                                                       -----------------------------    --------------------------------
                                                          2002             2001             2002              2001
                                                       ------------    -------------    -------------     --------------
<S>                                                         <C>             <C>              <C>               <C>
Change in benefit obligation:
  Net benefit obligation at beginning of year              $553.3          $483.6           $174.5            $130.7
  Service cost                                               12.9            11.0              5.5               4.0
  Interest cost                                              39.7            38.2             12.7              10.6
  Plan participants' contributions                           --              --                1.8               1.9
  Plan amendments                                             1.1            --               (0.9)             --
  Actuarial loss                                             33.0            56.6             34.3              40.7
  Gross benefits paid                                       (31.5)          (36.1)           (12.2)            (13.4)
                                                       ------------    -------------    -------------     --------------
    Net benefit obligation at end of year                   608.5           553.3            215.7             174.5
                                                       ------------    -------------    -------------     --------------

Change in plan assets:
  Fair value of plan assets at beginning of year            483.3           556.3             73.8              83.0
  Actual return on plan assets                              (25.1)          (36.9)            (7.2)             (6.8)
  Employer contributions                                     40.0            --               11.1               9.1
  Plan participants' contributions                           --              --                1.8               1.9
  Gross benefits paid                                       (31.5)          (36.1)           (12.2)            (13.4)
                                                       ------------    -------------    -------------     --------------
    Fair value of plan assets at end of year                466.7           483.3             67.3              73.8
                                                       ------------    -------------    -------------     --------------

Funded status at end of year                               (141.8)          (70.0)          (148.4)           (100.7)
Unrecognized net actuarial loss                             172.1            74.2             63.4              16.8
Unrecognized prior service cost                              19.9            21.5             (0.9)             (0.9)
Unrecognized net transition obligation (asset)               (1.4)           (3.3)            36.7              41.1
                                                       ------------    -------------    -------------     --------------
    Net amount recognized at end of year                    $48.8           $22.4           ($49.2)           ($43.7)
                                                       ============    =============    =============     ==============

Amounts recognized on the Consolidated
  Balance Sheets consist of:
    Prepaid benefit cost                                    $70.4           $45.5             $2.3              $2.1
    Accrued benefit cost                                    (21.6)          (23.1)           (51.5)            (45.8)
    Additional minimum liability                            (90.0)          (36.1)            --                --
    Intangible asset                                         16.5             8.7             --                --
    Accumulated other comprehensive loss                     73.5            27.4             --                --
                                                       ------------    -------------    -------------     --------------
     Net amount recognized at measurement date               48.8            22.4            (49.2)            (43.7)
                                                       ------------    -------------    -------------     --------------

Contributions paid after 9/30 and prior to 12/31             --              --                4.0               2.5
                                                       ------------    -------------    -------------     --------------
    Net amount recognized at 12/31                          $48.8           $22.4           ($45.2)           ($41.2)
                                                       ============    =============    =============     ==============
</TABLE>
                                       73
<PAGE>

The benefit obligation and fair value of plan assets for the postretirement
welfare plans with benefit obligations in excess of plan assets were $213.9
million and $64.3 million, respectively, at Sept. 30, 2002 and $167.8 million
and $64.5 million, respectively, at Sept. 30, 2001.  The projected benefit
obligation, accumulated benefit obligation and fair value of plan assets for
the qualified pension plans with accumulated benefit obligations in excess of
plan assets were $452.4 million, $418.8 million and $313.2 million,
respectively, at Sept. 30, 2002 and $293.9 million, $283.7 million and $225.7
million, respectively, at Sept. 30, 2001.  Alliant Energy's net periodic
benefit cost is primarily included in "Other operation and maintenance" in
the Consolidated Statements of Income.  For the various Alliant Energy
pension and postretirement plans, Alliant Energy common stock represented
less than 1% of total plan investments at Dec. 31, 2002 and 2001.

Alliant Energy sponsors several non-qualified pension plans that cover
certain current and former key employees.  At both Dec. 31, 2002 and 2001,
the funded balances of such plans totaled approximately $4 million, none of
which consisted of Alliant Energy common stock.  Alliant Energy's pension
benefit obligation under these plans was $38.2 million and $34.4 million at
Dec. 31, 2002 and 2001, respectively.  Alliant Energy's pension expense under
these plans was $4.3 million, $3.4 million, and $3.6 million in 2002, 2001
and 2000, respectively.

Alliant Energy has various life insurance policies that cover certain key
employees and directors.  At Dec. 31, 2002 and 2001, the cash surrender value
of these investments was $32 million and $30 million, respectively.  Under
Alliant Energy's deferred compensation plans, certain key employees and
directors can defer part or all of their current compensation in company
stock or interest accounts, which are held in grantor trusts.  At Dec. 31,
2002 and 2001, the fair market value of the trusts totaled approximately $4.9
million and $2.2 million, respectively, the majority of which consisted of
Alliant Energy common stock.  A significant number of Alliant Energy
employees also participate in defined contribution pension plans (401(k) and
Employee Stock Ownership plans).  Alliant Energy's contributions to the
plans, which are based on the participants' level of contribution, were $9.2
million, $8.2 million, and $8.1 million in 2002, 2001 and 2000,
respectively.

(b)  Equity Incentive Plans - In 2002, Alliant Energy shareowners approved
the EIP that permits the grant of incentive stock options, non-qualified
stock options, stock appreciation rights, restricted stock, restricted stock
units, performance shares and performance units to key employees.  At Dec.
31, 2002, non-qualified stock options were outstanding under this plan.  The
maximum number of shares of Alliant Energy common stock that may be issued
under the plan is 4 million.

Alliant Energy also has an LTEIP that permits the grant of incentive stock
options, non-qualified stock options, restricted stock, performance shares
and performance units to key employees.  At Dec. 31, 2002, non-qualified
stock options, restricted stock and performance shares were outstanding.  The
maximum number of shares of Alliant Energy common stock that may be issued
under the plan is 3.8 million.  This plan expires January 2004, at which time
no further grants may be made under this plan.

Options granted to date under the plans were granted at the quoted market
price of the shares on the date of grant, vest over three years and expire no
later than 10 years after the grant date.  Options become fully vested upon
retirement and remain exercisable at any time prior to their expiration date,
or for three years after the effective date of the retirement, whichever
period is shorter.  Participants' options that are not vested become
forfeited when participants leave Alliant Energy and their vested options
expire after three months.  A summary of the stock option activity was as
follows:

<TABLE>
<CAPTION>
                                                 2002                        2001                       2000
                                       -------------------------   -------------------------   -----------------------
                                                      Weighted                   Weighted                   Weighted
                                                      Average                     Average                   Average
                                                      Exercise                   Exercise                   Exercise
                                          Shares       Price          Shares       Price         Shares      Price
                                       -------------------------   -------------------------   -----------------------
<S>                                          <C>         <C>             <C>         <C>           <C>          <C>
Outstanding at beginning of year          2,917,229     $30.03        2,265,862    $29.67        1,543,028    $30.32
Options granted                             945,863      27.79          721,072     31.14          899,094     28.59
Options exercised                                --      --             (42,432)    29.87          (15,486)    30.03
Options forfeited                           (20,956)     29.41          (27,273)    30.07         (160,774)    29.90
                                       --------------              -------------               ------------
Outstanding at end of year                3,842,136      29.48        2,917,229     30.03        2,265,862     29.67
                                       ==============              =============               ============
Exercisable at end of year                2,242,187      29.93        1,593,047     29.94          962,073     30.12

</TABLE>
                                       74
<PAGE>

The range of exercise prices for the options outstanding at Dec. 31, 2002 was
$27.50 to $31.56.  The weighted-average remaining contractual life of
outstanding options at Dec. 31, 2002, 2001 and 2000 was 7.4 years, 7.7 years
and 8.3 years, respectively.  The value of the options granted during the
year using the Black-Scholes pricing method was as follows:

<TABLE>
<CAPTION>
                                                          2002            2001             2000
                                                      -------------    ------------     ------------
<S>                                                       <C>              <C>              <C>
Value of options                                         $9.14            $4.30            $7.71
Volatility                                               40.6%            18.9%            32.7%
Risk free interest rate                                   5.0%            5.0%             5.7%
Expected life                                           10 years        10 years         10 years
Expected dividend yield                                   6.0%            6.6%             6.3%

</TABLE>

At Dec. 31, 2002 and 2001, Alliant Energy had 1,745 and 61,137 shares of
restricted stock outstanding, respectively.  Any unvested shares of
restricted stock become fully vested upon retirement.  Participants' unvested
restricted stock is forfeited when the participant leaves Alliant Energy.
Compensation cost, which is recognized over the three-year restriction
period, was $0.2 million, $0.6 million and $0.6 million in 2002, 2001 and
2000, respectively.

The payout to key employees of Corporate Services for performance shares is
contingent upon achievement over a three-year period of specified earnings
per share growth and total return to shareowners of Alliant Energy compared
with an investor-owned utility peer group.  The payout to key employees of
Resources is contingent upon achievement over a three-year period of
specified Resources earnings per share growth.  Performance shares are paid
out in shares of Alliant Energy's common stock or a combination of cash and
stock and are modified by a performance multiplier, which ranges from zero to
two, based on the performance criteria.  Performance shares have an intrinsic
value equal to the quoted market price of a share on the date of grant.
Pursuant to APB 25, Alliant Energy accrues the plan expense over the
three-year period the services are performed and recognized (income) expense
of ($1.6) million, $2.4 million and $0.4 million in 2002, 2001 and 2000,
respectively.

(7)  COMMON AND PREFERRED STOCK
(a)  Common Stock - The number of shares of common stock issued by Alliant
Energy under its various stock plans was as follows:

<TABLE>
<CAPTION>
                                      2002               2001                2000
                                 ----------------   ----------------    ----------------
<S>                                     <C>               <C>                 <C>
Beginning balance                    89,682,334        79,010,114          78,984,014
Shares issued:
     Public offering                         --         9,775,000                  --
     Shareowner Direct Plan           1,877,032           668,379               5,666
     401(k) Savings Plan                689,336           161,239                  --
     Equity incentive plans              55,518            67,602              20,434
                                 ----------------   ----------------    ----------------
Ending balance                       92,304,220        89,682,334          79,010,114
                                 ================   ================    ================
</TABLE>

In November 2001, Alliant Energy completed a public offering of its common
stock generating net proceeds of approximately $263 million which were used
to repay short-term debt.  From January 2000 to June 2001, Alliant Energy
satisfied its requirements under the Shareowner Direct Plan (dividend
reinvestment and stock purchase plan) by acquiring Alliant Energy common
stock on the open market, rather than through original issue.  In 2000, 5,666
shares of common stock were issued related to an adjustment of a prior
acquisition of oil and gas properties.  At Dec. 31, 2002 and 2001, Alliant
Energy had a total of 6.8 million and 2.6 million shares, respectively,
available for issuance in the aggregate, pursuant to its Shareowner Direct
Plan, LTEIP, EIP and 401(k) Savings Plan.

Alliant Energy has a Shareowner Rights Plan whereby rights will be
exercisable only if a person or group acquires, or announces a tender offer
to acquire, 15% or more of Alliant Energy's common stock.  Each right will
initially entitle shareowners to buy one-half of one share of Alliant
Energy's common stock.  The rights will only be exercisable in multiples of
two at an initial price of $95.00 per full share, subject to adjustment.  If
any shareowner acquires 15% or more of the outstanding common stock of
Alliant Energy, each right (subject to limitations) will entitle its holder
to purchase, at the right's then current exercise price, a number of common
shares of Alliant Energy or of the acquirer having a market value at the time
of twice the right's per full share exercise price.  The Board of Directors
is also authorized to reduce the 15% ownership threshold to not less than
10%.

Alliant Energy's utility subsidiaries each have dividend payment restrictions
based on their respective bond indentures, the terms of their outstanding
preferred stock and state regulatory limitations applicable to them.  WP&L's

                                       75
<PAGE>

preferred stock restricts dividends to the extent that such dividend would
reduce the common stock equity ratio to less than 25%.  In its September 2002
rate order, the PSCW stated it must approve the payment of dividends by WP&L
to Alliant Energy in excess of the level forecasted in the order ($62 million
annually) if such dividends would reduce WP&L's common equity ratio below
44.67% of total capitalization.  In accordance with the IUB order authorizing
the IP&L merger, IP&L must inform the IUB if its common equity ratio falls
below 42% of total capitalization.  As of Dec. 31, 2002, Alliant Energy's
utility subsidiaries were in compliance with all such dividend restrictions.

In 2002, 11 non-employee directors received 1,000 shares each of Alliant
Energy common stock through the Shareowner Direct Plan as part of the
directors' compensation program, for a total of approximately $337,000.  In
2001, 14 non-employee directors received up to 1,000 shares each of Alliant
Energy common stock through the Shareowner Direct Plan, for a total of
approximately $338,000.  In 2000, 12 non-employee directors received up to
$20,000 each in Alliant Energy common stock, for a total of approximately
$222,000.

(b)  Preferred Stock - In September 2002, IP&L redeemed all of its then
outstanding shares of preferred stock.  In December 2002, IP&L issued six
million shares of preferred stock at $25.00 per share in a private
placement.  IP&L used the net proceeds of approximately $145 million to repay
its short-term debt and for general corporate purposes, including to fund
capital expenditures and to repay other debt.  The fair market value of
Alliant Energy's cumulative preferred stock of subsidiaries, based upon the
market yield of similar securities and quoted market prices, at Dec. 31, 2002
and 2001 was $198 million and $99 million, respectively.  Information related
to the carrying value of Alliant Energy's cumulative preferred stock of
subsidiaries, net at Dec. 31 was as follows (in millions):

<TABLE>
<CAPTION>
                                                                           2002            2001
                                                                        ------------   -------------
 Par/Stated   Authorized     Shares                         Mandatory
   Value        Shares     Outstanding       Series        Redemption
   -----        ------     -----------       ------        ----------
    <S>          <C>           <C>            <C>             <C>            <C>              <C>
     $25      16,000,000    6,000,000        8.375%            No           $150.0           $--
    $100          *          449,765      4.40% - 6.20%        No             45.0           45.0
     $25          *          599,460          6.50%            No             15.0           15.0
     $50      466,406 **     366,406      4.30% - 6.10%        No             --             18.3
     $50         ***         216,381      4.36% - 7.76%        No             --             10.8
     $50         ***         545,000          6.40%        $50 / share        --             27.3
                                                                        ------------   -------------
                                                                             210.0          116.4
    Less:  unamortized expenses                                               (4.9)          (2.4)
                                                                        ------------   -------------
                                                                            $205.1         $114.0
                                                                        ============   =============
</TABLE>

*   3,750,000 authorized shares in total.
**  Fully retired in 2002.
*** 2,000,000 authorized shares in total, fully retired in 2002.

(8)  DEBT
(a)  Short-Term Debt - To provide short-term borrowing flexibility and
security for commercial paper outstanding, Alliant Energy and its
subsidiaries maintain bank lines of credit, of which most require a fee.
Alliant Energy discontinued the use of its utility money pool in 2002 and
WP&L and IP&L are now meeting any short-term borrowing needs they have by
issuing commercial paper and borrowing on its bank lines of credit,
respectively.  At Dec. 31, 2001, IP&L and WP&L had money pool borrowings of
$38.0 million and $90.8 million, respectively.  Information regarding
short-term debt was as follows (dollars in millions):

<TABLE>
<CAPTION>
                                                          2002               2001
                                                     ----------------    -------------
<S>                                                         <C>               <C>
At Dec. 31:
   Commercial paper outstanding                             $195.5            $68.4
   Discount rates on commercial paper                     1.6-1.9%         2.4-3.2%
   Bank facility borrowings                                  $85.0              $--
   Interest rates on bank facility borrowings             2.3-2.4%              N/A
   Short-term borrowings at foreign subsidiaries             $28.7            $84.3
   Interest rates on foreign short-term borrowings        5.3-6.9%         5.6-6.9%

For the year ended:
   Average amount of short-term debt
      (based on daily outstanding balances)                 $337.9           $274.1
   Average interest rates on short-term debt                  2.7%             4.8%

</TABLE>
                                       76
<PAGE>

(b)  Long-Term Debt - The former IESU indentures securing its First Mortgage
and Collateral Trust Bonds constitute direct first mortgage liens and a
second lien while First Mortgage Bonds remain outstanding, respectively, upon
substantially all tangible public utility property of IP&L (excluding those
of the former IPC).  WP&L's and the former IPC's First Mortgage Bonds are
secured by substantially all of their utility plant.  IP&L, WP&L and
Resources also maintain indentures relating to the issuance of unsecured debt
securities.

In December 2002, Resources issued $300 million of 9.75% senior notes due
2013 in a private placement.  The notes are unconditionally guaranteed by
Alliant Energy.  Resources used the proceeds to repay short-term debt.  In
November 2001, Resources issued $300 million of senior notes at a fixed
interest rate of 7%, due 2011.  The notes are fully and unconditionally
guaranteed by Alliant Energy.  Resources used the proceeds to repay other
Resources' debt.  In March 2001, IP&L issued $200 million of senior unsecured
debentures at a fixed interest rate of 6-3/4%, due 2011.  IP&L used the
proceeds to repay short- and long-term debt.

Debt maturities for 2003 to 2007 are $47 million, $106 million, $337 million,
$68 million and $225 million, respectively.  Depending upon market
conditions, it is currently anticipated that a majority of the maturing debt
will be refinanced with the issuance of long-term securities.

The carrying value of Alliant Energy's long-term debt (including current
maturities and variable rate demand bonds) at Dec. 31, 2002 and 2001 was $2.7
billion and $2.5 billion, respectively.  The fair market value, based upon
the market yield of similar securities and quoted market prices, at Dec. 31,
2002 and 2001 was $2.9 billion and $2.6 billion, respectively.

(9)  INVESTMENTS AND ESTIMATED FAIR VALUE OF FINANCIAL INSTRUMENTS
The carrying amount of Alliant Energy's current assets and current
liabilities approximates fair value because of the short maturity of such
financial instruments.  Since IP&L and WP&L are subject to regulation, any
gains or losses related to the difference between the carrying amount and the
fair value of their financial instruments may not be realized by Alliant
Energy's shareowners.  Information relating to various investments held by
Alliant Energy at Dec. 31 that are marked-to-market as a result of SFAS 115
were as follows (in millions):

<TABLE>
<CAPTION>
                                                         2002                                    2001
                                           ----------------------------------     -----------------------------------
                                                               Unrealized                             Unrealized
                                            Carrying/Fair     Gains, Net of        Carrying/Fair    Gains/(Losses),
                                                Value              Tax                 Value          Net of Tax
                                           ----------------- ----------------     ---------------- ------------------
<S>                                             <C>                <C>                 <C>               <C>
Available-for-sale securities:
  Nuclear decommissioning trust funds:
     Debt securities                            $206               $9                  $191              $3
     Equity securities                           139               13                   142              42
        Total                                    345               22                   333              45
  Investment in McLeod                             2               --                    14              (9)
  Various other investments                       19                3                    23               1
Trading securities:
  Investment in McLeod                             1               (a)                    6              (a)

</TABLE>

(a)  Adjustments to the trading securities are reflected in earnings in the
     "Miscellaneous, net" line in the Consolidated Statements of Income.

Nuclear Decommissioning Trust Funds - At Dec. 31, 2002, $114 million, $43
million and $49 million of the debt securities mature in 2003-2010, 2011-2020
and 2021-2049, respectively.  The fair value of the nuclear decommissioning
trust funds was, as reported by the trustee, adjusted for the tax effect of
unrealized gains and losses.  Net unrealized holding gains were recorded as
part of accumulated provision for depreciation of related plant assets.  The
funds realized gains from the sales of securities of $10.4 million, $2.0
million and $5.0 million in 2002, 2001 and 2000, respectively (cost of the
investments based on specific identification was $111.1 million, $169.8
million and $213.4 million, respectively, and proceeds from the sales were
$121.5 million, $171.8 million and $218.4 million, respectively).

                                       77
<PAGE>

Investment in McLeod - Alliant Energy has investments in the common stock of
McLeod, a telecommunications company.  In accordance with SFAS 115, the
carrying values of the investments are adjusted to estimated fair value based
upon McLeod's closing price at the end of each quarter.  Changes in fair
value of investments designated as available-for-sale securities are reported
in other comprehensive income, and impact current earnings when gains or
losses are realized through sale or if a decline in value is determined to be
"other-than-temporary."  Changes in fair value of investments designated as
trading securities are reflected in earnings in the "Miscellaneous, net" line
in the Consolidated Statements of Income.

Upon the adoption of SFAS 133 in 2000 for the embedded derivative related to
McLeod stock in Resources' exchangeable senior notes (refer to Note 10(a) for
additional information), Alliant Energy designated a portion of its McLeod
investments as trading securities.  As result of this change in designation
to trading securities, in 2000, Alliant Energy reclassified $321.3 million of
unrealized appreciation ($187.3 million after-tax) from accumulated other
comprehensive income to net income.  In 2000, Alliant Energy recognized
miscellaneous income of $23.8 million for pre-tax gains realized upon sales
of McLeod available-for-sale securities, for which the appreciation was
previously reflected in accumulated other comprehensive income.

On Jan. 31, 2002, McLeod filed a pre-negotiated plan of reorganization in a
Chapter 11 bankruptcy proceeding and the trading of McLeod's common stock was
suspended by Nasdaq.  Consequently, Alliant Energy discontinued accounting
for its investment in McLeod under the provisions of SFAS 115 and reduced the
cost basis of its investments to the last quoted market price on Jan. 30,
2002.  In June 2002, Alliant Energy received from McLeod under its plan of
reorganization an initial distribution of approximately 3.3 million shares of
new common stock and classified 0.9 million and 2.4 million shares (0.1
million shares were received by discontinued operations) as trading and
available-for-sale securities, respectively.  With the receipt of the new
McLeod common shares and the resumption of trading on Nasdaq, Alliant Energy
resumed accounting for its McLeod investments under SFAS 115 and adjusted its
cost basis to the quoted market price on the date the shares were received.
As a result of these events, Alliant Energy recognized pre-tax impairment
charges in 2002 for available-for-sale securities totaling $27.2 million.

Investments in Foreign Entities - The geographic concentration of Alliant
Energy's significant continuing foreign investments at Dec. 31 was as follows
(in millions):

<TABLE>
<CAPTION>
                         Brazil        China       New Zealand        Mexico        Total
                        ---------    ----------   ---------------    ----------    ---------
<S>                         <C>          <C>                  <C>         <C>          <C>
2002
----
   Unconsolidated           $214         $19                  $86         $55          $374
   Consolidated               --         161                   --          --           161
                        ---------    ----------   ---------------    ----------    ---------
      Total                 $214        $180                  $86         $55          $535
                        =========    ==========   ===============    ==========    =========

2001
----
   Unconsolidated           $378         $21                  $68         $41          $508
   Consolidated               --         146                   --          --           146
                        ---------    ----------   ---------------    ----------    ---------
      Total                 $378        $167                  $68         $41          $654
                        =========    ==========   ===============    ==========    =========

</TABLE>

Brazil - Resources holds a non-controlling interest in five Brazilian
------
electric utility companies through several direct investments accounted for
under the equity method of accounting.  At Dec. 31, 2002 and 2001, Resources'
direct investments included a 49.9% direct ownership interest in GIPAR, S.A.,
an electric utility holding company; a 39.4% direct ownership interest in
Companhia Forca e Luz Cataguazes - Leopoldina, S.A. (Cataguazes), an electric
utility; a 45.6% direct ownership interest in Energisa, S.A., an energy
development company; a 49.9% direct ownership interest in Pbpart - SE 1
Ltda., an electric utility holding company; and a 50.0% (49.7% at Dec. 31,
2001) direct ownership interest in Usina Termeletrica de Juiz de Fora S.A., a
thermal power plant.

China - Resources' consolidated investments included a controlling interest
-----
in Peak Pacific Investment Company, Ltd., a company that develops investment
opportunities in generation infrastructure projects in China, and Anhui New
Energy Heat & Power Co., Ltd., a combined heat and power facility.
Resources' unconsolidated investments included a 50.0% ownership interest in
Jiaxing JIES Power & Heat Co., Ltd. and a 30.0% ownership interest in
Tongxiang TIES Power & Heat Co., Ltd.  Both of these combined heat and power
facilities are accounted for under the equity method.

                                       78
<PAGE>

New Zealand - Resources' investments included a 20.4% ownership interest in
-----------
TrustPower Ltd., a New Zealand hydro and wind generation utility company,
which is accounted for under the equity method and several other smaller
investments accounted for under the cost method.

Mexico - Resources' investment in Mexico consisted of a loan receivable
------
(including accrued interest income) from a Mexican development company.
Under provisions of the loan, Resources has agreed to lend up to $65 million
to support the development of a resort community near the Baja peninsula.
The loan accrues interest at 8.75% and is secured by the undeveloped land of
the resort community.  Repayment of the loan principal and interest will be
based on a portion of the proceeds from the sales of real estate in the
resort community and therefore is dependent on the successful development of
the project and the ability to sell real estate.  Alliant Energy may also
realize royalty income on the real estate sales once the loan is repaid.

Investment in ATC - At Dec. 31, 2002 and 2001, WP&L had ownership interests
in ATC of approximately 26.6% and 26.5%, respectively, and accounts for this
investment under the equity method.  Pursuant to various agreements, WP&L
receives a range of transmission services from ATC.  WP&L provides operation,
maintenance, and various transitional and construction services to ATC.  WP&L
and ATC also bill each other for use of shared facilities owned by each
party.  ATC billed WP&L $38.7 million and $36.4 million in 2002 and 2001,
respectively.  WP&L billed ATC $18.1 million and $18.4 million in 2002 and
2001, respectively, and recorded equity earnings of $14.3 million and $14.6
million in 2002 and 2001, respectively.

Unconsolidated Equity Investments - Summary financial information from Alliant
Energy's unconsolidated equity investments' financial statements is as
follows (in millions):

<TABLE>
<CAPTION>
                                               2002 *         2001        2000
                                             ------------  ------------ ----------
  <S>                                             <C>           <C>        <C>
  Operating revenues                            $1,440.6      $2,214.1   $1,194.3
  Operating income                                 159.8         138.2       42.5
  Net income (loss)                                 36.6          52.1       69.7
As of Dec. 31:
  Current assets                                   383.0         454.5
  Non-current assets                             1,976.4       2,117.0
  Current liabilities                              435.9         519.3
  Non-current liabilities                          505.1         557.0
  Minority interest                                133.4         213.5

</TABLE>

*  Alliant Energy's investment in Cargill-Alliant was sold in 2002.

(10)  DERIVATIVE FINANCIAL INSTRUMENTS
(a)  Accounting for Derivative Instruments and Hedging Activities - Alliant
Energy records derivative instruments at fair value on the balance sheet as
assets or liabilities and changes in the derivatives' fair values for
non-regulated entities in earnings unless specific hedge accounting criteria
are met.  For IP&L and WP&L, changes in the derivatives' fair values are
generally recorded as regulatory assets or liabilities.  The PSCW issued a
letter to WP&L in August 2002 authorizing accounting for its derivatives in
such manner.

At Dec. 31, 2002 and 2001, Alliant Energy had $6.4 million and $6.5 million,
respectively, of derivative assets included in "Other current assets" on its
Consolidated Balance Sheets and $9.1 million and $3.6 million, respectively,
of derivative liabilities included in "Other current liabilities" on its
Consolidated Balance Sheets.  At Dec. 31, 2001, Alliant Energy also had $0.4
million of derivative liabilities included in "Other long-term liabilities
and deferred credits" on its Consolidated Balance Sheets.

In the first quarter of 2001, Alliant Energy recorded a net loss of $12.9
million (all related to discontinued operations) for a cumulative effect of a
change in accounting principle representing the impact of adopting SFAS 133
as of Jan. 1, 2001 at Alliant Energy's equity method investees.  This
transition adjustment represents Alliant Energy's share of the difference
between the carrying amount of Southern Hydro's electricity derivative
contracts under the applicable accounting principles in effect at Dec. 31,
2000, and the carrying values of these electricity derivative contracts as
determined in accordance with SFAS 133 as of Jan. 1, 2001.

In the third quarter of 2000, Alliant Energy recorded net income of $16.7
million for a cumulative effect of a change in accounting principle
representing the impact of adopting SFAS 133 as of July 1, 2000 at Alliant

                                       79
<PAGE>

Energy's consolidated subsidiaries.  This transition adjustment was primarily
the result of the difference between the carrying amount of Resources'
exchangeable senior notes issued in February 2000 (due in 2030) under the
applicable accounting principles in effect at June 30, 2000, and the carrying
values of the debt and embedded derivative components of the notes as
determined in accordance with SFAS 133 as of July 1, 2000.  Transition
adjustments relating to Alliant Energy's other derivative instruments had no
material impact on net income.

During 2001 and 2000, $0.1 million of net gains (includes $0.1 million of net
losses from discontinued operations) and $6.7 million of net losses (includes
$1.3 million of net losses from discontinued operations), respectively,
included in the cumulative effect of a change in accounting principle
component of accumulated other comprehensive income (loss) were reclassified
into earnings, resulting in remaining balances of $0 and $0.1 million at Dec.
31, 2001 and 2000, respectively.

Cash Flow Hedging Instruments - During 2002 and 2001, Alliant Energy held
-----------------------------
various derivative instruments designated as cash flow hedging instruments.
WP&L utilized gas commodity financial swap arrangements to reduce the impact
of price fluctuations on gas purchased and injected into storage during the
summer months and withdrawn and sold at current market prices during the
winter months pursuant to the natural gas cost incentive sharing mechanism
with customers in Wisconsin.  IP&L and WP&L utilized physical coal purchase
contracts, which did not qualify for the normal purchase and sale exception,
to manage the price of anticipated coal purchases and sales.

In 2002 and 2001, a net loss of $0.1 million (includes a net gain of $0.1
million from discontinued operations) and a net gain of $2.0 million
(includes a net gain of $2.1 million from discontinued operations),
respectively, were recognized relating to the amount of hedge ineffectiveness
in accordance with SFAS 133.  In 2002 and 2001, Alliant Energy did not
exclude any components of the derivative instruments' gain or loss from the
assessment of hedge effectiveness and in 2001 reclassified a loss of $0.9
million (all continuing operations) into earnings as a result of the
discontinuance of hedges.  At Dec. 31, 2002, the maximum length of time over
which Alliant Energy hedged its exposure to the variability in future cash
flows for forecasted transactions was six months (three months for continuing
operations) and Alliant Energy estimated that losses of $3.3 million
(includes losses of $3.5 million for discontinued operations) will be
reclassified from accumulated other comprehensive income (loss) into earnings
in 2003 as the hedged transactions affect earnings.

Other Derivatives Not Designated in Hedge Relationships - Alliant Energy's
-------------------------------------------------------
derivatives that were not designated in hedge relationships during 2002
and/or 2001 included the embedded derivative component of Resources'
exchangeable senior notes, electricity price collars, and physical coal and
gas contracts not designated in hedge relationships.

At maturity, the holders of Resources' exchangeable senior notes are paid the
higher of the principal amount of the notes or an amount based on the value
of McLeod common stock.  SFAS 133 requires that Alliant Energy split the
initial value of the notes into debt and derivative components.  The payment
feature tied to McLeod stock is considered an embedded derivative under SFAS
133 that must be accounted for as a separate derivative instrument.  This
component is classified as a derivative liability on the Consolidated Balance
Sheets.  Subsequent changes in the fair value of the option are reflected as
increases or decreases in Alliant Energy's reported net income.  The carrying
amount of the host debt security, classified as long-term debt, is adjusted
for amortization of the debt discount in accordance with the interest method
as prescribed by APB 21, "Interest on Receivables and Payables."

Changes in the fair value of the McLeod shares designated as trading are
reflected as increases or decreases in Alliant Energy's net income.  These
trading gains or losses are expected to correspond with, and partially
offset, changes in the intrinsic value of the embedded derivative component
of Resources' exchangeable senior notes.  Changes in the time value portion
of the derivative component will result in non-cash increases or decreases to
Alliant Energy's net income.  Included in "Miscellaneous, net" in Alliant
Energy's Consolidated Statements of Income for 2002, 2001 and 2000 was
expense of $5.0 million, $215.1 million and $102.5 million, respectively,
related to the change in value of the McLeod trading securities, partially
offset by income of $0.4 million, $181.6 million and $101.8 million,
respectively, related to the change in value of the derivative component of
the exchangeable senior notes.

                                       80
<PAGE>

Electricity price collars were used to manage utility energy costs during
supply/demand imbalances.  Physical coal and gas contracts that do not
qualify for the normal purchase and sale exception were used to manage the
price of anticipated coal and gas purchases and sales.

(b)  Weather Derivatives - Alliant Energy uses weather derivatives to reduce
the impact of weather volatility on its natural gas sales volumes.  In 2002
and 2001, Corporate Services, as agent for IP&L and WP&L, entered into
non-exchange traded options based on heating degree days in which Corporate
Services receives payment from the counterparty if actual heating degree days
are less than the strike price in the contract.  Corporate Services paid
premiums to enter into these contracts, which are amortized to expense over
the contract period.  Alliant Energy has used the intrinsic value method to
account for these weather derivatives.

(c)  Nuclear Decommissioning Trust Fund Investments - Historically, WP&L has
entered into combinations of options to mitigate the effect of significant
market fluctuations on its common stock investments in its nuclear
decommissioning trust funds.  The derivative transactions are designed to
protect the portfolio's value while allowing the funds to earn a total return
modestly in excess of long-term expectations over the hedge period.  Fair
value changes of these instruments do not impact net income as they are
recorded as equally offsetting changes in the investment in nuclear
decommissioning trust funds and accumulated depreciation.

(d)  Energy-trading Contracts - Resources is the majority owner of a natural
gas marketing operation, NG Energy Trading, LLC (NG).  NG enters into
financial and physical contracts for the sale, purchase, storage,
transportation and loan of natural gas.  NG accounts for all its positions,
including gas in storage, at estimated fair value, with changes in fair value
reported in earnings.  Alliant Energy adopted EITF Issue 02-3 effective Jan.
1, 2003 for all contracts that were in place and storage gas acquired prior
to Oct. 25, 2002, and will reclassify prior period trading contracts on a net
basis in its Consolidated Statements of Income commencing in January 2003.

(11)  COMMITMENTS AND CONTINGENCIES
(a)  Construction and Acquisition Expenditures - Certain commitments have
been made in connection with 2003 capital expenditures.  During 2003, total
construction and acquisition expenditures relating to continuing operations
are estimated to be approximately $820 million.

(b)  Purchased-Power, Coal and Natural Gas Contracts - Alliant Energy,
through its subsidiaries Corporate Services, IP&L and WP&L, has entered into
purchased-power, coal and natural gas supply, transportation and storage
contracts.  Certain purchased-power commitments are considered operating
leases and are therefore not included here, but are included in Note 3.  The
natural gas supply commitments are all index-based.  Alliant Energy expects
to supplement its coal and natural gas supplies with spot market purchases as
needed.  The table includes commitments for "take-or-pay" contracts which
result in dollar commitments with no associated tons or Dths.  At Dec. 31, 2002,
Alliant Energy's minimum commitments were as follows (dollars and Dths in
millions; MWhs and tons in thousands):

<TABLE>
<CAPTION>
                   Purchased-power                   Coal                     Natural gas
                -----------------------    -------------------------    -------------------------
                 Dollars        MWhs        Dollars         Tons         Dollars         Dths
                ----------    ---------    ----------     ----------    -----------    ----------
<S>                <C>           <C>           <C>            <C>            <C>             <C>
2003              $114.5        2,752         $81.1          9,889          $90.7           6
2004                15.5          361          57.6          9,301           36.5          --
2005                 2.0           --          40.2          6,130           26.0          --
2006                 2.0           --          12.7            898           15.0          --
2007                 0.1           --           3.6             --           14.7          --
Thereafter           0.4           --           --              --           26.4          --

</TABLE>

(c)  Legal Proceedings - Alliant Energy is involved in legal and
administrative proceedings before various courts and agencies with respect to
matters arising in the ordinary course of business.  Although unable to
predict the outcome of these matters, Alliant Energy believes that
appropriate reserves have been established and final disposition of these
actions will not have a material adverse effect on its financial condition or
results of operations.

(d)  Guarantees and Commitments - At Dec. 31, 2002 and 2001, Alliant Energy
had guarantees outstanding to support unconsolidated affiliate and
third-party financing arrangements of approximately $4 million and $14
million, respectively.  Such guarantees are not included on Alliant Energy's
Consolidated Balance Sheets.  At Dec. 31, 2002, the remaining term of the
guarantees and the underlying debt was five years.  Refer to Note 3 for
discussion of Alliant Energy's residual value guarantees of its synthetic
leases.

                                       81
<PAGE>

In the third quarter of 2002, Alliant Energy sold its 50% ownership interest
in its Cargill-Alliant electricity-trading joint venture to Cargill.  Under
the purchase and sale agreement ("Agreement"), Alliant Energy agreed to
indemnify Cargill from expenses resulting from the breach of the
representations and warranties made by Alliant Energy as of the closing date,
and for the breach of its obligations under the Agreement.  While the
indemnification does not include a maximum limit, Alliant Energy believes the
likelihood of having to make any material cash payments under this
indemnification is remote.  At Dec. 31, 2002, there were no claims related to
the indemnification.

In November 2002, the FASB issued FIN 45 which requires disclosures by a
guarantor about its obligations under certain guarantees that it has issued.
FIN 45 also requires recognizing, at the inception of a guarantee, a
liability for the fair value of the obligation undertaken in issuing the
guarantee.  The recognition and measurement provisions of FIN 45 are
effective on a prospective basis for guarantees issued or modified after Dec.
31, 2002.  Alliant Energy does not anticipate FIN 45 will have a material
impact on its financial condition or results of operations.

(e)  Environmental Liabilities - Alliant Energy had recorded the following
environmental liabilities, and regulatory assets associated with certain of
these liabilities, at Dec. 31 (in millions):

<TABLE>
<CAPTION>

Environmental liabilities         2002           2001        Regulatory assets       2002           2001
-------------------------      -----------    -----------    -----------------    ----------     -----------
   <S>                             <C>            <C>             <C>                  <C>            <C>
   MGP sites                      $49.3          $43.9          MGP sites             $54.1          $50.2
   NEPA                             6.6            8.2          NEPA                    7.9            9.7
   Other                            0.2            0.4          Other                   2.9            3.2
                               -----------    -----------                         -----------    -----------
                                  $56.1          $52.5                                $64.9          $63.1
                               ===========    ===========                         ===========    ===========
</TABLE>

MGP Sites - IP&L and WP&L have current or previous ownership interests in 43
---------
and 14 sites, respectively, previously associated with the production of gas
for which they may be liable for investigation, remediation and monitoring
costs relating to the sites.  IP&L and WP&L have received letters from state
environmental agencies requiring no further action at eight and five sites,
respectively.  IP&L and WP&L are working pursuant to the requirements of
various federal and state agencies to investigate, mitigate, prevent and
remediate, where necessary, the environmental impacts to property, including
natural resources, at and around the sites in order to protect public health
and the environment.

IP&L and WP&L record environmental liabilities based upon periodic studies,
most recently updated in the third quarter of 2002, related to the MGP
sites.  Such amounts are based on the best current estimate of the remaining
amount to be incurred for investigation, remediation and monitoring costs for
those sites where the investigation process has been or is substantially
completed, and the minimum of the estimated cost range for those sites where
the investigation is in its earlier stages.  It is possible that future cost
estimates will be greater than current estimates as the investigation process
proceeds and as additional facts become known.  The amounts recognized as
liabilities are reduced for expenditures made and are adjusted as further
information develops or circumstances change.  Costs of future expenditures
for environmental remediation obligations are not discounted to their fair
value.  Management currently estimates the range of remaining costs to be
incurred for the investigation, remediation and monitoring of all utility
subsidiary sites to be approximately $37 million to $64 million.

Under the current rate making treatment approved by the PSCW, the MGP
expenditures of WP&L, net of any insurance proceeds, are deferred and
collected from gas customers over a five-year period after new rates are
implemented.  The MPUC also allows the deferral of MGP-related costs
applicable to the Minnesota sites and IP&L has been successful in obtaining
approval to recover such costs in rates in Minnesota.  The IUB has permitted
utilities to recover prudently incurred costs.  Regulatory assets have been
recorded by IP&L and WP&L, which reflect the probable future rate recovery,
where applicable.  Considering the current rate treatment, and assuming no
material change therein, IP&L and WP&L believe that the clean-up costs
incurred for these MGP sites will not have a material adverse effect on their
respective financial conditions or results of operations.

Settlement has been reached with all of IP&L's and WP&L's insurance carriers
regarding reimbursement for their MGP-related costs.  Insurance recoveries
available at Dec. 31, 2002 for IP&L and WP&L were $4.5 million and $2.1
million, respectively.  Pursuant to their applicable rate making treatment,
IP&L has recorded its recoveries in "Other long-term liabilities and deferred
credits" and WP&L has recorded its recoveries as an offset against its
regulatory assets.  In February 2001, the IUB issued an order directing IP&L
to refund its insurance recoveries related to former IESU MGP sites.  Under

                                       82
<PAGE>

the refund plan, IP&L returned 90% of the recoveries to customers of the
former IESU in 2001 and retained 10%.

NEPA - NEPA requires owners of nuclear power plants to pay a special
----
assessment into a "Uranium Enrichment Decontamination and Decommissioning
Fund."  The assessment is based upon prior nuclear fuel purchases.  IP&L and
WP&L recover the costs associated with this assessment through EACs and fuel
costs, respectively, over the period the costs are assessed.  Alliant Energy
continues to pursue relief from this assessment through litigation.

(f)  Decommissioning of DAEC and Kewaunee - The IUB, in its interim electric
rate order effective July 2002, allows IP&L to recover $11 million annually
for its share of the cost to decommission DAEC.  FERC, in its most recent
interim wholesale rate order effective April 2002, allows WP&L to recover $3
million annually for its share of the cost to decommission Kewaunee.  Both
interim orders are subject to refund, pending determination of final rates.
The PSCW, in an order effective Jan. 1, 2002, eliminated WP&L's recovery from
retail customers for the cost to decommission Kewaunee, due to the trust fund
being adequately funded.  Decommissioning expense is included in
"Depreciation and amortization" in the Consolidated Statements of Income and
the cumulative amount is included in "Accumulated depreciation" on the
Consolidated Balance Sheets to the extent recovered through rates.

Additional information relating to the decommissioning of DAEC and Kewaunee
was as follows (dollars in millions):

<TABLE>
<CAPTION>
                                                                            DAEC                     Kewaunee
                                                                  -------------------------    ----------------------
<S>                                                                        <C>                        <C>
Assumptions relating to current rate recovery amounts:
     Alliant Energy's share of estimated decommissioning cost              $374.3                     $263.2
     Year dollars in                                                        2002                       2002
     Method to develop estimate                                     Site-specific study         Site-specific study
     Annual inflation rate                                                 4.20%                       6.50%
     Decommissioning method                                          Prompt dismantling         Prompt dismantling
                                                                        and removal                 and removal
     Year decommissioning to commence                                       2014                       2013
     After-tax return on external investments:
          Qualified                                                         7.10%                     6.12%
          Non-qualified                                                     4.70%                     5.14%
External trust fund balance at Dec. 31, 2002                               $121.2                    $223.7
Internal reserve at Dec. 31, 2002                                           $21.7                       $--
After-tax earnings on external trust funds in 2002                           $3.8                     $19.7

</TABLE>

The interim rate recovery amounts for DAEC only include an inflation estimate
through 2005.  Both IP&L and WP&L are funding all rate recoveries for
decommissioning into external trust funds and funding on a tax-qualified
basis to the extent possible.  In accordance with their respective regulatory
requirements, IP&L and WP&L record the earnings on the external trust funds
as interest income with a corresponding entry to interest expense at IP&L and
to depreciation expense at WP&L.  The earnings accumulate in the external
trust fund balances and in accumulated depreciation on utility plant.

SFAS 143, which provides accounting and disclosure requirements for
retirement obligations associated with long-lived assets, was adopted by
Alliant Energy on Jan. 1, 2003.  SFAS 143 requires that the present value of
retirement costs for which Alliant Energy has a legal obligation be recorded
as liabilities with an equivalent amount added to the asset cost.  The
liability is accreted to its present value each period and the capitalized
cost is depreciated over the useful life of the related asset.  Upon
settlement of the liability, an entity settles the obligation for its
recorded amount or incurs a gain or loss.  The adoption of SFAS 143 will have
no impact on IP&L's and WP&L's earnings, as the effects will be offset by the
establishment of regulatory assets or liabilities pursuant to SFAS 71.

Alliant Energy has completed a detailed assessment of the specific
applicability and implications of SFAS 143.  The scope of SFAS 143 as it
relates to Alliant Energy primarily includes decommissioning costs for DAEC
and Kewaunee.  It also applies to a smaller extent to several other regulated
and non-regulated assets including, but not limited to, active ash landfills,
water intake facilities, underground storage tanks, groundwater wells,
transmission and distribution equipment, easements, leases and the
dismantlement of certain hydro facilities.  Other than DAEC and Kewaunee,
Alliant Energy's asset retirement obligations as of Jan. 1, 2003 are not
significant.
                                       83
<PAGE>

Prior to January 2003, IP&L and WP&L recorded nuclear decommissioning charges
in accumulated depreciation on their Consolidated Balance Sheets.  Upon
adoption of SFAS 143, IP&L and WP&L will reverse approximately $125 million
and $175 million, respectively, previously recorded in accumulated
depreciation and will record liabilities of approximately $250 million and
$175 million, respectively.  The difference between amounts previously
recorded and the net SFAS 143 liability will be deferred as a regulatory
asset and is expected to approximate $125 million and $0 for IP&L and WP&L,
respectively.

IP&L and WP&L have previously recognized removal costs as a component of
depreciation expense and accumulated depreciation for other non-nuclear
assets in accordance with regulatory rate recovery.  As of Dec. 31, 2002,
IP&L and WP&L estimate that they have approximately $250 million and $150
million, respectively, of such regulatory liabilities recorded in
"Accumulated depreciation" on their Consolidated Balance Sheets.

(12)  JOINTLY-OWNED ELECTRIC UTILITY PLANT
Under joint ownership agreements with other Iowa and Wisconsin utilities, the
utility subsidiaries have undivided ownership interests in jointly-owned
electric generating stations.  IP&L also has joint ownership agreements
related to transmission facilities.  Each of the respective owners is
responsible for the financing of its portion of the construction costs.  KWh
generation and operating expenses are divided on the same basis as ownership
with each owner reflecting its respective costs in its Consolidated
Statements of Income.  Information relative to the utility subsidiaries'
ownership interest in these facilities at Dec. 31, 2002 was as follows
(dollars in millions):

<TABLE>
<CAPTION>
                                                                             Accumulated     Construction
                                 Fuel        Ownership         Plant in     Provision for      Work-In-
                                 Type        Interest %        Service       Depreciation      Progress
                               ---------- ----------------- --------------- --------------- ----------------
<S>                                             <C>              <C>             <C>             <C>
IP&L
----
   DAEC                         Nuclear         70.0             $543.3          $318.5          $25.2
   Ottumwa                       Coal           48.0              190.9           118.2            0.7
   Neal Unit 4                   Coal           21.5               85.3            59.4            0.2
   Neal Unit 3                   Coal           28.0               59.9            36.9            1.9
   Louisa Unit 1                 Coal            4.0               25.0            14.9            0.1
                                                            --------------- --------------- ----------------
                                                                  904.4           547.9           28.1
                                                            --------------- --------------- ----------------
WP&L
----
   Edgewater Unit 5              Coal           75.0              234.8           112.9            0.4
   Columbia Energy Center        Coal           46.2              187.5           110.3            1.6
   Kewaunee                     Nuclear         41.0              172.6           120.9            6.8
   Edgewater Unit 4              Coal           68.2               60.0            36.1            1.6
                                                            --------------- --------------- ----------------
                                                                  654.9           380.2           10.4
                                                            --------------- --------------- ----------------

                                                               $1,559.3          $928.1          $38.5
                                                            =============== =============== ================
</TABLE>

(13)  SEGMENTS OF BUSINESS
Alliant Energy's principal business segments are:

o  Regulated domestic utilities - consists of IP&L and WP&L, serving
   customers in Iowa, Wisconsin, Minnesota and Illinois, and includes three
   segments: a) electric operations; b) gas operations; and c) other, which
   includes the steam and water businesses and the unallocated portions of the
   utility business.  Various line items in the following tables are not
   allocated to the electric and gas segments for management reporting
   purposes and therefore are included in "Total Regulated Domestic Utilities."
o  Non-regulated businesses - represents the operations of Resources, its
   subsidiaries and Alliant Energy's investment in Cargill-Alliant (sold in
   2002), and is broken down into two segments: a) International (Int'l) and
   b) other, which includes the operations of the Integrated Services,
   Investments, Non-regulated Generation, Energy Technologies and Mass
   Marketing business units described in Note 1(a); the operations of
   Resources (the non-regulated holding company); and any non-regulated
   reconciling/eliminating entries.
o  Other - includes the operations of Alliant Energy (the parent company)
   and Corporate Services, as well as any Alliant Energy parent company
   reconciling/eliminating entries.

                                       84
<PAGE>

Intersegment revenues were not material to Alliant Energy's operations and
there was no single customer whose revenues were 10% or more of Alliant
Energy's consolidated revenues.  Refer to Note 9 for a breakdown of Alliant
Energy's international investments by country.  Certain financial information
relating to Alliant Energy's significant business segments and products and
services was as follows (in millions):

<TABLE>
<CAPTION>
                                        Regulated Domestic Utilities          Non-regulated Businesses
                                    -------------------------------------- -------------------------------            Alliant Energy
                                    Electric    Gas     Other     Total      Int'l     Other      Total     Other      Consolidated
------------------------------------------------------------------------------------------------------------------------------------
<S>                                    <C>        <C>       <C>       <C>      <C>       <C>        <C>        <C>         <C>
2002
----
Operating revenues                   $1,752.5   $394.0    $37.2    $2,183.7  $103.2    $328.6     $431.8     ($6.7)      $2,608.8
Depreciation and amortization           250.6     27.9      3.9       282.4    11.2      17.0       28.2      --            310.6
Operating income (loss)                 299.2     26.2      8.2       333.6     9.7     (21.1)     (11.4)     (0.5)         321.7
Interest expense, net of AFUDC                                        100.0    44.9      31.6       76.5       2.3          178.8
Interest income from loans to
   discontinued operations, net                                        --      (6.0)    (10.0)     (16.0)     --            (16.0)
Equity (income) loss from
   unconsolidated investments                                         (17.6)   17.1      13.3       30.4      --             12.8
Preferred dividends                                                     6.2    --        --         --        --              6.2
Impairment of available-for-sale
   securities of McLeodUSA Inc.                                       --       --        27.2       27.2      --             27.2
Miscellaneous, net                                                    (27.9)    3.4      25.4       28.8      (0.6)           0.3
Income tax expense (benefit)                                          107.1   (12.1)    (54.6)     (66.7)     (4.3)          36.1
Income from continuing operations                                     165.8   (37.6)    (54.0)     (91.6)      2.1           76.3
Income from discontinued
   operations, net of tax                                              --      10.5      20.1       30.6      --             30.6
Net income (loss)                                                     165.8   (27.1)    (33.9)     (61.0)      2.1          106.9
Total assets                          3,676.5    574.9    474.8     4,726.2 1,009.6   1,250.8    2,260.4      14.8        7,001.4
Investments in equity method
   subsidiaries                         125.1     --       --         125.1   297.1      29.1      326.2       0.3          451.6
Construction and acquisition
   expenditures                         371.3     28.6      4.8       404.7    65.5     152.8      218.3      33.8          656.8

------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
                                         Regulated Domestic Utilities           Non-regulated Businesses
                                     ---------------------------------------  ------------------------------         Alliant Energy
                                     Electric    Gas     Other     Total       Int'l     Other      Total     Other   Consolidated
-----------------------------------------------------------------------------------------------------------------------------------
<S>                                     <C>        <C>      <C>      <C>           <C>     <C>        <C>        <C>       <C>
2001
----
Operating revenues                    $1,756.6   $487.9    $37.1   $2,281.6      $85.4   $263.3     $348.7     ($5.6)    $2,624.7
Depreciation and amortization            245.6     28.8      3.2      277.6        8.3     16.7       25.0      --          302.6
Operating income (loss)                  306.1     11.2      7.5      324.8        7.4    (13.3)      (5.9)     (1.9)       317.0
Interest expense, net of AFUDC                                        100.5       54.6      9.6       64.2       9.8        174.5
Interest income from loans to
   discontinued operations, net                                        --         (0.1)    (9.8)      (9.9)     --           (9.9)
Equity (income) loss from
   unconsolidated investments                                         (15.6)       4.1     (7.2)      (3.1)     (0.1)       (18.8)
Preferred dividends                                                     6.7       --       --         --        --            6.7
Miscellaneous, net                                                    (25.9)      (2.8)    20.7       17.9      (4.6)       (12.6)
Income tax expense (benefit)                                           94.2      (22.7)   (12.3)     (35.0)     (8.4)        50.8
Income from continuing operations                                     164.9      (25.7)   (14.3)     (40.0)      1.4        126.3
Income from discontinued
   operations, net of tax                                              --         11.3     47.7       59.0      --           59.0
Cumulative effect of a change in
   accounting principle, net of tax                                    --        (12.9)    --        (12.9)     --          (12.9)
Net income (loss)                                                     164.9      (27.3)    33.4        6.1       1.4        172.4
Total assets                           3,336.6    506.4    465.0    4,308.0      858.6    995.9    1,854.5      75.4      6,237.9
Investments in equity method
   subsidiaries                          119.2     --       --        119.2      448.3     32.6      480.9      --          600.1
Construction and acquisition
   expenditures                          298.7     36.9      5.2      340.8      173.0    159.3      332.3      40.0        713.1

-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
                                       85
<PAGE>
<TABLE>
<CAPTION>
                                         Regulated Domestic Utilities           Non-regulated Businesses
                                    ---------------------------------------- -------------------------------          Alliant Energy
                                    Electric    Gas     Other      Total       Int'l     Other      Total     Other    Consolidated
------------------------------------------------------------------------------------------------------------------------------------
<S>                                   <C>       <C>      <C>      <C>          <C>       <C>        <C>        <C>        <C>
2000
----
Operating revenues                    $1,648.0  $415.0   $33.4    $2,096.4     $ --      $186.0     $186.0     ($2.7)     $2,279.7
Depreciation and amortization            252.6    27.7     3.1       283.4        3.7       9.6       13.3      --           296.7
Operating income (loss)                  330.6    26.6     4.5       361.7       (7.8)    (18.1)     (25.9)      0.2         336.0
Interest expense, net of AFUDC                                       103.1       38.8       9.0       47.8       8.5         159.4
Interest income from loans to
   discontinued operations, net                                       --         --        (7.2)      (7.2)     --            (7.2)
Equity income from
   unconsolidated investments                                         (0.5)      (5.8)    (13.2)     (19.0)     --           (19.5)
Preferred dividends                                                    6.7       --        --         --        --             6.7
Gain on reclassification of
   investments                                                        --         --      (321.3)    (321.3)     --          (321.3)
Miscellaneous, net                                                   (23.3)      (8.9)     (4.3)     (13.2)     (2.7)        (39.2)
Income tax expense                                                   107.9      (14.2)    132.2      118.0       0.3         226.2
Income from continuing operations                                    167.8      (17.7)    186.7      169.0      (5.9)        330.9
Income from discontinued
   operations, net of tax                                             --         (0.5)     51.6       51.1      --            51.1
Cumulative effect of a change in
   accounting principle, net of tax                                   --         --        16.7       16.7      --            16.7
Net income (loss)                                                    167.8      (18.2)    255.0      236.8      (5.9)        398.7
Total assets                           3,402.2   554.4   427.2     4,383.8      631.0   1,702.3    2,333.3      16.7       6,733.8
Investments in equity method
   subsidiaries                            6.5    --      --           6.5      389.0      29.5      418.5      --           425.0
Construction and acquisition
   expenditures                          265.9    35.8     3.0       304.7      395.6     134.1      529.7      11.1         845.5

------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Products and Services
---------------------
                                     Non-regulated and Other Revenues
-----------------------------------------------------------------------------------------------------------
              Integrated
Year           Services      International    Mass Marketing    Investments       Other        Total
-----------------------------------------------------------------------------------------------------------
                                               (in millions)
<S>               <C>             <C>               <C>              <C>             <C>         <C>
2002             $258.8          $103.2            $46.9            $26.1           $27.3       $462.3
2001              241.9            85.4              6.8             26.6            19.5        380.2
2000              172.3            --                0.7             28.5            15.2        216.7

</TABLE>

(14)  GOODWILL AND OTHER INTANGIBLE ASSETS
Alliant Energy adopted SFAS 142 on Jan. 1, 2002, which resulted
in goodwill no longer being subject to amortization.  Had
SFAS 142 been adopted Jan. 1, 2000, net income for 2001
and 2000 would have increased $4 million and $1 million, respectively, and
basic and diluted EPS would have increased $0.05 and $0.02 per share,
respectively.  Certain information regarding net goodwill and other
intangible assets included on Alliant Energy's Consolidated Balance Sheets at
Dec. 31 was as follows (in millions):

<TABLE>
<CAPTION>
                                                                                     2002           2001
                                                                                  -----------    -----------
<S>                                                                                    <C>           <C>
Net goodwill
    Deferred charges and other (consolidated investments)                              $66           $66
    Investments in unconsolidated foreign entities (equity method investments)           9             7
Net other intangible assets
    Deferred charges and other (consolidated investments)                               19            20
    Investments in unconsolidated foreign entities (equity method investments)          22            35
    Investment in ATC and other (equity method investments)                             25            --

</TABLE>

In January 2003, Alliant Energy committed to a plan to sell its interest in
SmartEnergy by year-end.  In the fourth quarter of 2002, Alliant Energy
recorded a SFAS 142 after-tax non-cash goodwill impairment charge related to
SmartEnergy of $4.5 million primarily due to less favorable market
conditions.  The fair value of SmartEnergy's goodwill was estimated using a
combination of the expected discounted future cash flows and market value

                                       86
<PAGE>

indicators.  The impairment charge was recorded in continuing operations,
"Miscellaneous, net," in Alliant Energy's Consolidated Statement of Income for
2002.

(15)  SELECTED CONSOLIDATED QUARTERLY FINANCIAL DATA (UNAUDITED)
All "per share" references refer to earnings per diluted share.  Summation of
the individual quarters may not equal annual totals due to rounding.

<TABLE>
<CAPTION>
                                                         2002                                      2001
                                         ----------------------------------------  ---------------------------------------
                                          March 31   June 30   Sept. 30  Dec. 31    March 31   June 30  Sept. 30   Dec. 31
                                         ---------- --------- --------- ---------  ---------- --------- --------  --------
                                                              (in millions, except per share data)

<S>                                          <C>       <C>       <C>       <C>         <C>       <C>       <C>       <C>
Operating revenues                         $608.6    $570.9    $709.4    $719.9      $805.6    $571.0    $631.1    $617.0
Operating income                             63.1      58.7     128.3      71.6        69.4      54.3     125.2      68.1
Income (loss) from continuing operations     (8.4)     (6.7)     43.9      47.5        18.6       8.6      53.2      45.8
Income (loss) from discontinued
   operations, net of tax                    18.1      13.1       0.8      (1.4)        3.5      29.1      16.1      10.3
Cumulative effect of a change in
   accounting principle, net of tax           --        --       --        --         (12.9)     --        --        --
Net income                                    9.7       6.3      44.7      46.1         9.2      37.7      69.3      56.1
EPS:
  Income (loss) from continuing operations  (0.09)    (0.07)     0.48      0.52        0.23      0.11      0.67      0.54
  Income (loss) from discontinued
   operations                                0.20      0.14      0.01     (0.01)       0.05      0.37      0.20      0.12
  Cumulative effect of a change in
   accounting principle                       --        --      --         --         (0.16)     --        --        --
  Net income                                 0.11      0.07      0.49      0.51        0.12      0.48      0.87      0.66

</TABLE>

(16)  DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE
Alliant Energy announced in November 2002 its commitment to pursue the sale
of, or other exit strategies for, certain non-regulated businesses in 2003.
In the fourth quarter of 2002, Alliant Energy applied the provisions of SFAS
144, "Accounting for the Impairment or Disposal of Long-Lived Assets," to
certain of its assets which were held for sale.  SFAS 144 requires that a
long-lived asset classified as held for sale be measured at the lower of its
carrying amount or fair value, less costs to sell, and to cease depreciation,
depletion and amortization.  At Dec. 31, 2002, Alliant Energy's oil and gas
(Whiting), Australian (including Southern Hydro) and affordable housing
businesses have been classified as held for sale.  Alliant Energy currently
plans to complete the sales by year-end.  The operating results for these
businesses have been separately classified and reported as discontinued
operations in Alliant Energy's Consolidated Financial Statements.  A summary
of the components of discontinued operations in Alliant Energy's Consolidated
Statements of Income was as follows (in thousands):

<TABLE>
<CAPTION>
                                                         2002             2001            2000
                                                    --------------    ------------    -------------
<S>                                                       <C>             <C>             <C>
Operating revenues                                      $185,576        $152,664        $125,310
Operating expenses                                       140,037          99,598          80,224
Interest expense and other                                15,466         (14,992)        (18,589)
                                                    --------------    ------------    -------------
Income before income taxes                                30,073          68,058          63,675
Income tax expense (benefit)                                (539)          9,073          12,636
                                                    --------------    ------------    -------------
Income from discontinued operations, net of tax          $30,612         $58,985         $51,039
                                                    ==============    ============    =============
</TABLE>

Alliant Energy's Australian business enters into electricity derivative
contracts that have not been designated as hedges (as defined by SFAS 133) to
manage the electricity commodity price risk associated with anticipated sales
into the spot market.  Approximately $16 million of income is included in
"Interest expense and other" for both 2002 and 2001 in the previous table
related to the change in the fair value of these electricity derivative
contracts during these respective periods.  In 2000, Alliant Energy's
affordable housing business sold a portion of its investment in McLeod,
resulting in a pre-tax gain of approximately $24 million included in
"Interest expense and other" in the previous table.  At Dec. 31, 2002, Alliant
Energy's affordable housing business owned approximately 0.1 million shares
of McLeod.  "Income tax expense (benefit)" in the previous table includes
approximately $10 million, $10 million and $7 million of affordable housing

                                       87
<PAGE>

tax credits earned by Alliant Energy's affordable housing business during
2002, 2001 and 2000, respectively.  These tax credits had a significant
impact on the effective tax rate of Alliant Energy's discontinued
operations.

A summary of the components of assets and liabilities of discontinued operations
on Alliant Energy's Consolidated Balance Sheets at Dec. 31 was as
follows (in thousands):

<TABLE>
<CAPTION>
                                                              2002             2001
                                                          -------------    ------------
<S>                                                             <C>            <C>
Assets of discontinued operations:
   Property, plant and equipment, net                         $644,137       $420,619
   Current assets                                               99,044         45,217
   Investments                                                   6,824         60,442
   Deferred charges and other                                  194,323         13,909
                                                          -------------    ------------
       Total assets of discontinued operations                $944,328       $540,187
                                                          =============    ============

Liabilities of discontinued operations:
   Current liabilities                                          65,885         28,521
   Other long-term liabilities and deferred credits             68,990         32,125
   Minority interest                                               124            267
                                                          -------------    ------------
       Total liabilities of discontinued operations            134,999         60,913
                                                          -------------    ------------
         Net assets of discontinued operations                $809,329       $479,274
                                                          =============    ============
</TABLE>

In March 2002, Alliant Energy acquired a controlling interest in Southern
Hydro and therefore changed from the equity method of accounting to the
consolidation method at such time.

A summary of the components of cash flows for discontinued operations for the
years ended Dec. 31 was as follows (in thousands):

<TABLE>
<CAPTION>
                                                                     2002           2001          2000
                                                                 -------------   ------------  ------------
<S>                                                                   <C>             <C>           <C>
Net cash flows from operating activities                            $84,118         $51,562       $44,844
Net cash flows from financing activities                            141,234          32,079        99,338
Net cash flows used for investing activities                       (215,583)        (87,051)     (145,573)
                                                                 -------------   ------------  ------------
Net increase (decrease) in cash and temporary cash investments        9,769          (3,410)       (1,391)
Cash and temporary cash investments at beginning of period            5,261           8,671        10,062
                                                                 -------------   ------------  ------------
Cash and temporary cash investments at end of period                $15,030          $5,261        $8,671
                                                                 =============   ============  ============
Supplemental cash flows information:
  Cash paid during the period for:
     Interest                                                       $14,693          $6,350        $4,878
                                                                 =============   ============  ============
     Income taxes, net of refunds                                   ($7,712)        ($3,331)        ($331)
                                                                 =============   ============  ============
</TABLE>

(17)   CONDENSED CONSOLIDATING FINANCIAL STATEMENTS
Alliant Energy has fully and unconditionally guaranteed the payment of
principal and interest on various debt securities issued by Resources and, as
a result, is required to present condensed consolidating financial
statements.  No other Alliant Energy subsidiaries are guarantors of
Resources' debt securities.  Alliant Energy's condensed consolidating
financial statements are as follows:

                                       88
<PAGE>
<TABLE>
<CAPTION>
   Alliant Energy Corporation Condensed Consolidating Statements of Income for the Years Ended December 31, 2002 and 2001

                                                               Alliant Energy              Other Alliant               Consolidated
                                                                   Parent                     Energy     Consolidating    Alliant
                                                                  Company      Resources   Subsidiaries   Adjustments     Energy
                                                               --------------------------------------------------------------------
Year Ended December 31, 2002                                                              (in thousands)
----------------------------
<S>                                                                    <C>         <C>          <C>             <C>          <C>
Operating revenues:
  Electric utility                                                      $-            $-    $1,752,534            $-    $1,752,534
  Gas utility                                                            -             -       393,986             -       393,986
  Non-regulated and other                                                -       431,819       356,286      (325,813)      462,292
                                                               --------------------------------------------------------------------
                                                                         -       431,819     2,502,806      (325,813)    2,608,812
                                                               --------------------------------------------------------------------
Operating expenses:
  Electric and steam production fuels                                    -             -       303,570            55       303,625
  Purchased power                                                        -             -       362,501             -       362,501
  Cost of utility gas sold                                               -             -       248,994             -       248,994
  Other operation and maintenance                                    2,116       408,419       846,988      (300,379)      957,144
  Depreciation and amortization                                          7        28,242       288,577        (6,209)      310,617
  Taxes other than income taxes                                          -         6,517        99,031        (1,312)      104,236
                                                               --------------------------------------------------------------------
                                                                     2,123       443,178     2,149,661      (307,845)    2,287,117
                                                               --------------------------------------------------------------------
Operating income (loss)                                             (2,123)      (11,359)      353,145       (17,968)      321,695
                                                               --------------------------------------------------------------------
Interest expense and other:
  Interest expense                                                   5,640        76,486       116,344       (11,932)      186,538
  Interest income from loans to discontinued operations, net             -       (15,959)            -             -       (15,959)
  Equity (income) loss from unconsolidated investments                (941)       31,337       (17,571)            -        12,825
  Allowance for funds used during construction                           -             -        (8,480)          784        (7,696)
  Preferred dividend requirements of subsidiaries                        -             -         6,172             -         6,172
  Impairment of available-for-sale securities of McLeodUSA Inc.          -        27,218             -             -        27,218
  Miscellaneous, net                                              (109,236)       27,218       (17,167)       99,405           220
                                                               --------------------------------------------------------------------
                                                                  (104,537)      146,300        79,298        88,257       209,318
                                                               --------------------------------------------------------------------
Income (loss) from continuing operations before income taxes       102,414      (157,659)      273,847      (106,225)      112,377
                                                               --------------------------------------------------------------------
Income tax expense (benefit)                                        (4,467)      (66,442)      107,959          (942)       36,108
                                                               --------------------------------------------------------------------
Income (loss) from continuing operations                           106,881       (91,217)      165,888      (105,283)       76,269
                                                               --------------------------------------------------------------------
Income from discontinued operations, net of tax                          -        30,612             -             -        30,612
                                                               --------------------------------------------------------------------
Net income (loss)                                                 $106,881      ($60,605)     $165,888     ($105,283)     $106,881
                                                               ====================================================================

<PAGE>

Year Ended December 31, 2001
----------------------------
Operating revenues:
  Electric utility                                                      $-            $-    $1,756,556            $-    $1,756,556
  Gas utility                                                            -             -       487,877             -       487,877
  Non-regulated and other                                                -       348,611       310,520      (278,888)      380,243
                                                               --------------------------------------------------------------------
                                                                         -       348,611     2,554,953      (278,888)    2,624,676
                                                               --------------------------------------------------------------------
Operating expenses:
  Electric and steam production fuels                                    -             -       310,689             -       310,689
  Purchased power                                                        -             -       403,166             -       403,166
  Cost of utility gas sold                                               -             -       360,911             -       360,911
  Other operation and maintenance                                    3,609       322,599       772,246      (270,329)      828,125
  Depreciation and amortization                                          -        25,052       277,591             -       302,643
  Taxes other than income taxes                                          -         6,897       103,408        (8,121)      102,184
                                                               --------------------------------------------------------------------
                                                                     3,609       354,548     2,228,011      (278,450)    2,307,718
                                                               --------------------------------------------------------------------
Operating income (loss)                                             (3,609)       (5,937)      326,942          (438)      316,958
                                                               --------------------------------------------------------------------
Interest expense and other:
  Interest expense                                                  14,281        64,096       117,707       (10,480)      185,604
  Interest income from loans to discontinued operations, net             -        (9,938)            -             -        (9,938)
  Equity (income) loss from unconsolidated investments              (7,237)        4,138       (15,700)            -       (18,799)
  Allowance for funds used during construction                           -             -       (11,144)            -       (11,144)
  Preferred dividend requirements of subsidiaries                        -             -         6,720             -         6,720
  Miscellaneous, net                                              (177,151)       18,026       (30,285)      176,913       (12,497)
                                                               --------------------------------------------------------------------
                                                                  (170,107)       76,322        67,298       166,433       139,946
                                                               --------------------------------------------------------------------
Income (loss) from continuing operations before income taxes       166,498       (82,259)      259,644      (166,871)      177,012
                                                               --------------------------------------------------------------------
Income tax expense (benefit)                                        (5,864)      (37,573)       94,642          (438)       50,767
                                                               --------------------------------------------------------------------
Income (loss) from continuing operations                           172,362       (44,686)      165,002      (166,433)      126,245
                                                               --------------------------------------------------------------------
Income from discontinued operations, net of tax                          -        58,985             -             -        58,985
                                                               --------------------------------------------------------------------
Income before cumulative effect of a change in
   accounting principle, net of tax                                172,362        14,299       165,002      (166,433)      185,230
                                                               --------------------------------------------------------------------
Cumulative effect of a change in accounting principle, net of tax        -       (12,868)            -             -       (12,868)
                                                               --------------------------------------------------------------------
Net income                                                        $172,362        $1,431      $165,002     ($166,433)     $172,362
                                                               ====================================================================
</TABLE>
                                       89
<PAGE>

<TABLE>
<CAPTION>
       Alliant Energy Corporation Condensed Consolidating Statement of Income for the Year Ended December 31, 2000

                                                                Alliant Energy                 Other                    Consolidated
                                                                   Parent                  Alliant Energy Consolidating    Alliant
                                                                   Company      Resources   Subsidiaries   Adjustments     Energy
                                                              ----------------------------------------------------------------------
Operating revenues:                                                                        (in thousands)
<S>                                                                    <C>         <C>         <C>             <C>            <C>
  Electric utility                                                     $-            $-    $1,648,036            $-      $1,648,036
  Gas utility                                                           -             -       414,948             -         414,948
  Non-regulated and other                                               -       185,952       294,507      (263,769)        216,690
                                                              ----------------------------------------------------------------------
                                                                        -       185,952     2,357,491      (263,769)      2,279,674
                                                              ----------------------------------------------------------------------
Operating expenses:
  Electric and steam production fuels                                   -             -       288,621             -         288,621
  Purchased power                                                       -             -       294,818             -         294,818
  Cost of utility gas sold                                              -             -       278,734             -         278,734
  Other operation and maintenance                                     703       192,472       751,888      (258,087)        686,976
  Depreciation and amortization                                         -        13,350       283,382             -         296,732
  Taxes other than income taxes                                         -         6,069        98,379        (6,625)         97,823
                                                              ----------------------------------------------------------------------
                                                                      703       211,891     1,995,822      (264,712)      1,943,704
                                                              ----------------------------------------------------------------------
Operating income (loss)                                              (703)      (25,939)      361,669           943         335,970
                                                              ----------------------------------------------------------------------
Interest expense and other:
  Interest expense                                                 17,350        47,832       121,250       (18,283)        168,149
  Interest income from loans to discontinued operations, net            -        (7,195)            -             -          (7,195)
  Equity income from unconsolidated investments                   (14,653)       (4,311)         (504)            -         (19,468)
  Allowance for funds used during construction                          -             -        (8,761)            -          (8,761)
  Preferred dividend requirements of subsidiaries                       -             -         6,713             -           6,713
  Gain on reclassification of investment                                -      (321,349)            -             -        (321,349)
  Miscellaneous, net                                             (407,484)      (13,234)      (31,790)      413,294         (39,214)
                                                              ----------------------------------------------------------------------
                                                                 (404,787)     (298,257)       86,908       395,011        (221,125)
                                                              ----------------------------------------------------------------------
Income from continuing operations before income taxes             404,084       272,318       274,761      (394,068)        557,095
                                                              ----------------------------------------------------------------------
Income taxes                                                        5,422       112,820       106,996           942         226,180
                                                              ----------------------------------------------------------------------
Income from continuing operations                                 398,662       159,498       167,765      (395,010)        330,915
                                                              ----------------------------------------------------------------------
Income from discontinued operations, net of tax                         -        51,039             -             -          51,039
                                                              ----------------------------------------------------------------------
Income before cumulative effect of a change in
   accounting principle, net of tax                               398,662       210,537       167,765      (395,010)        381,954
                                                              ----------------------------------------------------------------------
Cumulative effect of a change in accounting principle, net of tax       -        16,673            35             -          16,708
                                                              ----------------------------------------------------------------------
Net income                                                       $398,662      $227,210      $167,800     ($395,010)       $398,662
                                                              ======================================================================

<PAGE>

                           Alliant Energy Corporation Condensed Consolidating Balance Sheet as of December 31, 2002

                                                                Alliant Energy                Other                     Consolidated
                                                                   Parent                Alliant Energy Consolidating     Alliant
ASSETS                                                             Company     Resources   Subsidiaries   Adjustments      Energy
Property, plant and equipment:                                ----------------------------------------------------------------------
  Utility:                                                                                (in thousands)
      Electric plant in service                                        $-            $-    $5,295,381            $-      $5,295,381
      Gas plant in service                                              -             -       613,122             -         613,122
      Other plant in service                                            -             -       530,456             -         530,456
      Accumulated depreciation                                          -             -    (3,573,407)            -      (3,573,407)
      Construction work in progress                                     -             -       263,096             -         263,096
      Other, net                                                        -             -        68,340             -          68,340
                                                              ----------------------------------------------------------------------
          Total utility                                                 -             -     3,196,988             -       3,196,988
                                                              ----------------------------------------------------------------------
  Non-regulated and other, net:
      Non-regulated generation                                          -       156,699             -             -         156,699
      Other                                                             -       300,128        75,503          (111)        375,520
                                                              ----------------------------------------------------------------------
          Total non-regulated and other                                 -       456,827        75,503          (111)        532,219
                                                              ----------------------------------------------------------------------
                                                                        -       456,827     3,272,491          (111)      3,729,207
                                                              ----------------------------------------------------------------------
Current assets:
  Income tax refunds receivable                                    18,175        72,882         6,412             -          97,469
  Regulatory assets                                                     -             -        46,076             -          46,076
  Assets of discontinued operations                                     -       944,328             -             -         944,328
  Other                                                           254,461       219,028       489,181      (436,395)        526,275
                                                              ----------------------------------------------------------------------
                                                                  272,636     1,236,238       541,669      (436,395)      1,614,148
                                                              ----------------------------------------------------------------------
Investments:
  Consolidated subsidiaries                                     1,817,341             -            10    (1,817,351)              -
  Investments in unconsolidated foreign entities                        -       373,816             -             -         373,816
  Other                                                            11,660        56,357       494,867             -         562,884
                                                              ----------------------------------------------------------------------
                                                                1,829,001       430,173       494,877    (1,817,351)        936,700
                                                              ----------------------------------------------------------------------
Deferred charges and other                                              -       137,202       611,721       (27,583)        721,340
                                                              ----------------------------------------------------------------------
Total assets                                                   $2,101,637    $2,260,440    $4,920,758   ($2,281,440)     $7,001,395
                                                              ======================================================================
</TABLE>
                                       90
<PAGE>

<TABLE>
<CAPTION>
           Alliant Energy Corporation Condensed Consolidating Balance Sheet (Continued) as of December 31, 2002

                                                       Alliant Energy                 Other Alliant                   Consolidated
                                                           Parent                        Energy       Consolidating      Alliant
                                                           Company      Resources     Subsidiaries     Adjustments       Energy
                                                     ------------------------------------------------------------------------------
CAPITALIZATION AND LIABILITIES                                                        (in thousands)
<S>                                                           <C>             <C>            <C>           <C>              <C>
Capitalization:
  Common stock and additional paid-in capital             $1,294,842      $232,743        $906,261     ($1,139,004)     $1,294,842
  Retained earnings                                          758,187       114,838         773,556        (888,394)        758,187
  Accumulated other comprehensive loss                      (209,943)     (166,947)        (42,996)        209,943        (209,943)
  Shares in deferred compensation trust                       (6,896)            -               -               -          (6,896)
                                                     ------------------------------------------------------------------------------
       Total common equity                                 1,836,190       180,634       1,636,821      (1,817,455)      1,836,190
                                                     ------------------------------------------------------------------------------

  Cumulative preferred stock of subsidiaries, net                  -             -         205,063               -         205,063
  Long-term debt (excluding current portion)                  24,000     1,290,205       1,323,598               -       2,637,803
                                                     ------------------------------------------------------------------------------
                                                           1,860,190     1,470,839       3,165,482      (1,817,455)      4,679,056
                                                     ------------------------------------------------------------------------------
Current liabilities:
  Current maturities and sinking funds                             -        41,511           5,080               -          46,591
  Commercial paper                                           135,500             -          60,000               -         195,500
  Other short-term borrowings                                 85,000       194,482          79,003        (244,764)        113,721
  Accounts payable                                             1,534        61,503         223,653               -         286,690
  Accrued taxes                                                9,743        14,149          82,123               -         106,015
  Liabilities of discontinued operations                           -       134,999               -               -         134,999
  Other                                                        6,419       122,395         305,819        (191,631)        243,002
                                                     ------------------------------------------------------------------------------
                                                             238,196       569,039         755,678        (436,395)      1,126,518
                                                     ------------------------------------------------------------------------------
Other long-term liabilities and deferred credits:
  Accumulated deferred income tax expense (benefit)           (3,198)      137,263         492,352               -         626,417
  Pension and other benefit obligations                        6,328         4,348         170,334               -         181,010
  Other                                                          121        35,526         336,912         (27,590)        344,969
                                                     ------------------------------------------------------------------------------
                                                               3,251       177,137         999,598         (27,590)      1,152,396
                                                     ------------------------------------------------------------------------------
                                                     ------------------------------------------------------------------------------
Minority interest                                                  -        43,425               -               -          43,425
                                                     ------------------------------------------------------------------------------
Total capitalization and liabilities                      $2,101,637    $2,260,440      $4,920,758     ($2,281,440)     $7,001,395
                                                     ==============================================================================

                    Alliant Energy Corporation Condensed Consolidating Balance Sheet as of December 31, 2001

ASSETS
Property, plant and equipment:
  Utility:
      Electric plant in service                                   $-            $-      $5,123,781              $-      $5,123,781
      Gas plant in service                                         -             -         597,494               -         597,494
      Other plant in service                                       -             -         517,938               -         517,938
      Accumulated depreciation                                     -             -      (3,374,867)              -      (3,374,867)
      Construction work in progress                                -             -         111,069               -         111,069
      Other, net                                                   -             -          62,194               -          62,194
                                                     ------------------------------------------------------------------------------
          Total utility                                            -             -       3,037,609               -       3,037,609
                                                     ------------------------------------------------------------------------------
  Non-regulated and other, net:
      Non-regulated generation                                     -        60,411               -               -          60,411
      Other                                                        -       295,255          49,014            (111)        344,158
                                                     ------------------------------------------------------------------------------
          Total non-regulated and other                            -       355,666          49,014            (111)        404,569
                                                     ------------------------------------------------------------------------------
                                                                   -       355,666       3,086,623            (111)      3,442,178
                                                     ------------------------------------------------------------------------------
Current assets:
  Income tax refunds receivable                                7,552        11,438           6,411               -          25,401
  Regulatory assets                                                -             -          19,632               -          19,632
  Assets of discontinued operations                                -       540,187               -               -         540,187
  Other                                                      180,962       231,008         337,582        (225,916)        523,636
                                                     ------------------------------------------------------------------------------
                                                             188,514       782,633         363,625        (225,916)      1,108,856
                                                     ------------------------------------------------------------------------------
Investments:
  Consolidated subsidiaries                                1,793,737             -               -      (1,793,737)              -
  Investments in unconsolidated foreign entities                   -       508,145               -               -         508,145
  Other                                                       32,814        66,028         477,929             (14)        576,757
                                                     ------------------------------------------------------------------------------
                                                           1,826,551       574,173         477,929      (1,793,751)      1,084,902
                                                     ------------------------------------------------------------------------------
Deferred charges and other                                     3,661       120,005         511,537         (33,214)        601,989
                                                     ------------------------------------------------------------------------------
Total assets                                              $2,018,726    $1,832,477      $4,439,714     ($2,052,992)     $6,237,925
                                                     ==============================================================================
</TABLE>
                                       91
<PAGE>

<TABLE>
<CAPTION>
                     Alliant Energy Corporation Condensed Consolidating Balance Sheet (Continued) as of December 31, 2001

                                                                  Alliant Energy             Other Alliant              Consolidated
                                                                      Parent                    Energy     Consolidating   Alliant
                                                                      Company    Resources   Subsidiaries   Adjustments    Energy
                                                                  ------------------------------------------------------------------
CAPITALIZATION AND LIABILITIES                                                                (in thousands)
<S>                                                                    <C>           <C>          <C>           <C>          <C>
Capitalization:
  Common stock and additional paid-in capital                      $1,240,690     $232,743     $789,002    ($1,021,745)  $1,240,690
  Retained earnings                                                   832,293      175,443      749,102       (924,545)     832,293
  Accumulated other comprehensive loss                               (152,434)    (140,137)     (12,297)       152,434     (152,434)
  Shares in deferred compensation trust                                (2,208)           -            -              -       (2,208)
                                                                  ------------------------------------------------------------------
       Total common equity                                          1,918,341      268,049    1,525,807     (1,793,856)   1,918,341
                                                                  ------------------------------------------------------------------

  Cumulative preferred stock of subsidiaries, net                           -            -      113,953              -      113,953
  Long-term debt (excluding current portion)                           24,000    1,105,792    1,328,149              -    2,457,941
                                                                  ------------------------------------------------------------------
                                                                    1,942,341    1,373,841    2,967,909     (1,793,856)   4,490,235
                                                                  ------------------------------------------------------------------
Current liabilities:
  Current maturities and sinking funds                                      -        9,946          560              -       10,506
  Commercial paper                                                     68,389            -            -              -       68,389
  Other short-term borrowings                                               -       84,318            -              -       84,318
  Accounts payable                                                          -       35,969      185,949            (95)     221,823
  Accrued taxes                                                             -        9,712       77,387              -       87,099
  Liabilities of discontinued operations                                    -       60,913            -              -       60,913
  Other                                                                 4,341       46,670      404,134       (225,821)     229,324
                                                                  ------------------------------------------------------------------
                                                                       72,730      247,528      668,030       (225,916)     762,372
                                                                  ------------------------------------------------------------------
Other long-term liabilities and deferred credits:
  Accumulated deferred income tax expense (benefit)                    (4,033)     152,196      459,389              -      607,552
  Pension and other benefit obligations                                 7,555        3,539       85,402              -       96,496
  Other                                                                   133       12,262      258,984        (33,220)     238,159
                                                                  ------------------------------------------------------------------
                                                                        3,655      167,997      803,775        (33,220)     942,207
                                                                  ------------------------------------------------------------------
                                                                  ------------------------------------------------------------------
Minority interest                                                           -       43,111            -              -       43,111
                                                                  ------------------------------------------------------------------
Total capitalization and liabilities                               $2,018,726   $1,832,477   $4,439,714    ($2,052,992)  $6,237,925
                                                                  ==================================================================

<PAGE>

        Alliant Energy Corporation Condensed Consolidating Statement of Cash Flows for the Year Ended December 31, 2002

                                                                  Alliant Energy            Other Alliant               Consolidated
                                                                     Parent                    Energy     Consolidating   Alliant
                                                                     Company     Resources  Subsidiaries   Adjustments    Energy
                                                                  ------------------------------------------------------------------
                                                                                            (in thousands)

 Net cash flows from operating activities                            $107,594      $89,116     $458,785      ($111,455)    $544,040
                                                                  ------------------------------------------------------------------

 Cash flows from (used for) financing activities:
     Common stock dividends                                          (180,987)           -     (141,435)       141,435     (180,987)
     Proceeds from issuance of common stock                            56,066            -            -              -       56,066
     Proceeds from issuance of preferred stock of subsidiary                -            -      144,602              -      144,602
     Redemption of preferred stock of subsidiary                            -            -      (56,389)             -      (56,389)
     Net change in Resources' credit facility                               -     (383,610)           -              -     (383,610)
     Proceeds from issuance of other long-term debt                         -      300,023            -              -      300,023
     Reductions in other long-term debt                                     -      (20,258)        (560)             -      (20,818)
     Net change in commercial paper and other short-term borrowings    76,106      153,795      (31,695)         1,939      200,145
     Net change in loans to discontinued operations                         -       49,320            -              -       49,320
     Other                                                              1,417      (15,760)     105,431       (115,350)     (24,262)
                                                                  ------------------------------------------------------------------
         Net cash flows from (used for) financing activities          (47,398)      83,510       19,954         28,024       84,090
                                                                  ------------------------------------------------------------------
 Cash flows used for investing activities:
     Construction and acquisition expenditures:
        Regulated domestic utilities                                        -            -     (404,736)             -     (404,736)
        Non-regulated businesses                                            -     (218,282)           -              -     (218,282)
        Corporate Services and other                                      (50)           -      (33,724)             -      (33,774)
     Proceeds from dispositions of assets                              19,349        8,295            -              -       27,644
     Other                                                            (85,872)      24,859      (27,867)        85,370       (3,510)
                                                                  ------------------------------------------------------------------
        Net cash flows used for investing activities                  (66,573)    (185,128)    (466,327)        85,370     (632,658)
                                                                  ------------------------------------------------------------------
 Net increase (decrease) in cash and temporary cash investments        (6,377)     (12,502)      12,412          1,939       (4,528)
                                                                  ------------------------------------------------------------------
 Cash and temporary cash investments at beginning of period             6,381       60,751        3,207         (1,939)      68,400
                                                                  ------------------------------------------------------------------
 Cash and temporary cash investments at end of period                      $4      $48,249      $15,619             $-      $63,872
                                                                  ==================================================================

Supplemental cash flows information:
     Cash paid (refunded) during the period for:
        Interest                                                       $5,244      $74,933     $103,969             $-     $184,146
                                                                  ==================================================================
        Income taxes, net of refunds                                  ($2,183)    ($46,033)     $77,575             $-      $29,359
                                                                  ==================================================================
     Noncash investing and financing activities:
        Capital lease obligations incurred                                 $-           $-      $19,101             $-      $19,101
                                                                  ==================================================================
</TABLE>
                                       92
<PAGE>

<TABLE>
<CAPTION>
   Alliant Energy Corporation Condensed Consolidating Statements of Cash Flows for the Years Ended December 31, 2001 and 2000

                                                                  Alliant Energy             Other Alliant              Consolidated
                                                                     Parent                    Energy      Consolidating   Alliant
                                                                     Company     Resources  Subsidiaries    Adjustments    Energy
                                                                   -----------------------------------------------------------------
Year Ended December 31, 2001                                                                  (in thousands)
----------------------------
<S>                                                                    <C>          <C>           <C>          <C>           <C>
 Net cash flows from (used for) operating activities                 $155,559     ($10,090)     $453,795     ($173,153)    $426,111
                                                                   -----------------------------------------------------------------
 Cash flows from (used for) financing activities:
     Common stock dividends                                          (158,231)           -      (140,789)      140,789     (158,231)
     Proceeds from issuance of common stock                           288,553            -             -             -      288,553
     Net change in Resources' credit facility                               -       63,110             -             -       63,110
     Proceeds from issuance of other long-term debt                         -      313,530       200,000             -      513,530
     Reductions in other long-term debt                                     -       (9,249)     (136,110)            -     (145,359)
     Net change in commercial paper and other short-term borrowings  (265,496)     (54,953)            -             -     (320,449)
     Net change in loans to discontinued operations                         -      (39,556)            -             -      (39,556)
     Other                                                             46,777      (30,112)      (16,850)      (30,888)     (31,073)
                                                                   -----------------------------------------------------------------
         Net cash flows from (used for) financing activities          (88,397)     242,770       (93,749)      109,901      170,525
                                                                   -----------------------------------------------------------------
 Cash flows used for investing activities:
     Construction and acquisition expenditures:
        Regulated domestic utilities                                        -            -      (340,789)            -     (340,789)
        Non-regulated businesses                                            -     (332,253)            -             -     (332,253)
        Corporate Services                                                  -            -       (40,019)            -      (40,019)
     Proceeds from formation of ATC and other asset dispositions            -       32,117        75,817             -      107,934
     Other                                                            (61,355)       2,922       (54,015)       61,313      (51,135)
                                                                   -----------------------------------------------------------------
        Net cash flows used for investing activities                  (61,355)    (297,214)     (359,006)       61,313     (656,262)
                                                                   -----------------------------------------------------------------
 Net increase (decrease) in cash and temporary cash investments         5,807      (64,534)        1,040        (1,939)     (59,626)
                                                                   -----------------------------------------------------------------
 Cash and temporary cash investments at beginning of period               574      125,285         2,167             -      128,026
                                                                   -----------------------------------------------------------------
 Cash and temporary cash investments at end of period                  $6,381      $60,751        $3,207       ($1,939)     $68,400
                                                                   =================================================================
Supplemental cash flows information:
     Cash paid (refunded) during the period for:
        Interest                                                      $12,461      $60,772      $107,123            $-     $180,356
                                                                   =================================================================
        Income taxes, net of refunds                                 ($10,258)    ($32,015)     $113,168            $-      $70,895
                                                                   =================================================================
     Noncash investing and financing activities:
        Capital lease obligations incurred and other                       $-           $-       $19,967            $-      $19,967
                                                                   =================================================================

<PAGE>

Year Ended December 31, 2000
----------------------------
 Net cash flows from (used for) operating activities                 $391,284     ($23,712)     $427,241     ($401,723)    $393,090
                                                                   -----------------------------------------------------------------
 Cash flows from (used for) financing activities:
     Common stock dividends                                          (157,964)           -       (80,340)       80,340     (157,964)
     Proceeds from issuance of common stock                             1,069            -             -             -        1,069
     Net change in Resources' credit facility                               -      181,652             -             -      181,652
     Proceeds from issuance of exchangeable senior notes                    -      402,500             -             -      402,500
     Proceeds from issuance of other long-term debt                         -        7,747       100,000             -      107,747
     Reductions in other long-term debt                                     -         (501)      (53,071)            -      (53,572)
     Net change in commercial paper and other short-term borrowings    48,060       99,217             -             -      147,277
     Net change in loans to discontinued operations                         -      (87,112)            -             -      (87,112)
     Other                                                              3,385      (13,962)      (23,212)        5,255      (28,534)
                                                                   -----------------------------------------------------------------
         Net cash flows from (used for) financing activities         (105,450)     589,541       (56,623)       85,595      513,063
                                                                   -----------------------------------------------------------------
 Cash flows used for investing activities:
     Construction and acquisition expenditures:
        Regulated domestic utilities                                        -            -      (304,656)            -     (304,656)
        Non-regulated businesses                                            -     (529,675)            -             -     (529,675)
        Corporate Services and other                                        -            -       (11,123)            -      (11,123)
     Proceeds from dispositions of assets                               2,281       25,273         3,336             -       30,890
     Other                                                           (316,188)       8,834       (63,463)      316,128      (54,689)
                                                                   -----------------------------------------------------------------
        Net cash flows used for investing activities                 (313,907)    (495,568)     (375,906)      316,128     (869,253)
                                                                   -----------------------------------------------------------------
 Net increase (decrease) in cash and temporary cash investments       (28,073)      70,261        (5,288)            -       36,900
                                                                   -----------------------------------------------------------------
 Cash and temporary cash investments at beginning of period            28,647       55,024         7,455             -       91,126
                                                                   -----------------------------------------------------------------
 Cash and temporary cash investments at end of period                    $574     $125,285        $2,167            $-     $128,026
                                                                   =================================================================
Supplemental cash flows information:
     Cash paid (refunded) during the period for:
        Interest                                                      $17,220      $44,135       $97,495            $-     $158,850
                                                                   =================================================================
        Income taxes, net of refunds                                  ($2,350)    ($20,560)     $140,136            $-     $117,226
                                                                   =================================================================
     Noncash investing and financing activities:
        Capital lease obligations incurred and other                       $-           $-       $20,419            $-      $20,419
                                                                   =================================================================
</TABLE>
                                       93
<PAGE>

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Shareowners of Interstate Power and Light Company:

We have audited the accompanying consolidated balance sheets and statements
of capitalization of Interstate Power and Light Company and subsidiaries (the
"Company") as of December 31, 2002 and 2001, and related consolidated
statements of income, cash flows and changes in common equity for each of the
three years in the period ended December 31, 2002.  Our audit also included
the supplemental schedule listed in Item 15(a)(2).  These financial
statements and the supplemental schedule are the responsibility of the
Company's management.  Our responsibility is to express an opinion on these
financial statements and the supplemental schedule based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement.  An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements.  An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation.  We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all
material respects, the financial position of the Company as of December 31,
2002 and 2001, and the results of its operations and its cash flows for each
of the three years in the period ended December 31, 2002 in conformity with
accounting principles generally accepted in the United States of America.
Also, in our opinion, such supplemental schedule, when considered in relation
to the basic consolidated financial statements taken as a whole, presents
fairly in all material respects the information set forth therein.


/s/ DELOITTE & TOUCHE LLP
-------------------------


Milwaukee, Wisconsin
March 18, 2003

                                       94
<PAGE>
<TABLE>
<CAPTION>
                                       INTERSTATE POWER AND LIGHT COMPANY
                                       CONSOLIDATED STATEMENTS OF INCOME

                                                                       Year Ended December 31,
                                                            2002                   2001               2000
-----------------------------------------------------------------------------------------------------------------
                                                                             (in thousands)
<S>                                                             <C>                <C>                    <C>
Operating revenues:
  Electric utility                                            $964,854           $1,003,106             $955,845
  Gas utility                                                  214,895              281,014              249,796
  Steam                                                         31,859               32,130               28,366
                                                      -----------------    -----------------    -----------------
                                                             1,211,608            1,316,250            1,234,007
                                                      -----------------    -----------------    -----------------

-----------------------------------------------------------------------------------------------------------------

Operating expenses:
  Electric and steam production fuels                          171,133              189,967              175,413
  Purchased power                                              145,292              185,860              147,879
  Cost of gas sold                                             138,875              207,088              171,603
  Other operation and maintenance                              339,214              322,644              308,434
  Depreciation and amortization                                146,137              148,494              143,471
  Taxes other than income taxes                                 64,846               62,783               62,592
                                                      -----------------    -----------------    -----------------
                                                             1,005,497            1,116,836            1,009,392
                                                      -----------------    -----------------    -----------------

-----------------------------------------------------------------------------------------------------------------

Operating income                                               206,111              199,414              224,615
                                                      -----------------    -----------------    -----------------

-----------------------------------------------------------------------------------------------------------------

Interest expense and other:
  Interest expense                                              67,458               68,149               67,234
  Allowance for funds used during construction                  (5,057)              (6,391)              (3,396)
  Miscellaneous, net                                            (9,461)             (13,377)              (7,370)
                                                      -----------------    -----------------    -----------------
                                                                52,940               48,381               56,468
                                                      -----------------    -----------------    -----------------

-----------------------------------------------------------------------------------------------------------------

Income before income taxes                                     153,171              151,033              168,147
                                                      -----------------    -----------------    -----------------

-----------------------------------------------------------------------------------------------------------------

Income taxes                                                    62,294               52,967               65,020
                                                      -----------------    -----------------    -----------------

-----------------------------------------------------------------------------------------------------------------

Net income                                                      90,877               98,066              103,127
                                                      -----------------    -----------------    -----------------

-----------------------------------------------------------------------------------------------------------------

Preferred dividend requirements                                  2,862                3,410                3,403
                                                      -----------------    -----------------    -----------------

-----------------------------------------------------------------------------------------------------------------

Earnings available for common stock                            $88,015              $94,656              $99,724
                                                      =================    =================    =================

-----------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
</TABLE>
                                       95
<PAGE>
<TABLE>
<CAPTION>
                                     INTERSTATE POWER AND LIGHT COMPANY
                                          CONSOLIDATED BALANCE SHEETS

                                                                                      December 31,
ASSETS                                                                          2002                 2001
----------------------------------------------------------------------------------------------------------------
                                                                                       (in thousands)
<S>                                                                                <C>                  <C>
Property, plant and equipment:
  Electric plant in service                                                     $3,451,547           $3,344,188
  Gas plant in service                                                             326,470              316,613
  Steam plant in service                                                            59,737               59,452
  Other plant in service                                                           195,328              182,868
  Accumulated depreciation                                                      (2,163,371)          (2,046,756)
                                                                          -----------------    -----------------
    Net plant                                                                    1,869,711            1,856,365
  Construction work in progress                                                    166,350               73,241
  Other, net                                                                        50,529               44,110
                                                                          -----------------    -----------------
                                                                                 2,086,590            1,973,716
                                                                          -----------------    -----------------

----------------------------------------------------------------------------------------------------------------

Current assets:
  Cash and temporary cash investments                                                6,076                   87
  Accounts receivable:
    Customer, less allowance for doubtful accounts of $894 and $1,564               42,647               19,950
    Associated companies                                                            79,105                4,718
    Other, less allowance for doubtful accounts of $388 and $319                    27,898               25,497
  Production fuel, at average cost                                                  36,852               32,083
  Materials and supplies, at average cost                                           28,821               29,121
  Gas stored underground, at average cost                                           19,450               18,447
  Regulatory assets                                                                 18,077               14,469
  Prepayments and other                                                             13,941                9,498
                                                                          -----------------    -----------------
                                                                                   272,867              153,870
                                                                          -----------------    -----------------

----------------------------------------------------------------------------------------------------------------

Investments:
  Nuclear decommissioning trust funds                                              121,158              117,159
  Other                                                                             13,492               15,157
                                                                          -----------------    -----------------
                                                                                   134,650              132,316
                                                                          -----------------    -----------------

----------------------------------------------------------------------------------------------------------------

Other assets:
  Regulatory assets                                                                199,691              132,109
  Deferred charges and other                                                        44,608               34,303
                                                                          -----------------    -----------------
                                                                                   244,299              166,412
                                                                          -----------------    -----------------

----------------------------------------------------------------------------------------------------------------

Total assets                                                                    $2,738,406           $2,426,314
                                                                          =================    =================

----------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

</TABLE>
                                       96
<PAGE>
<TABLE>
<CAPTION>
                                       INTERSTATE POWER AND LIGHT COMPANY
                                      CONSOLIDATED BALANCE SHEETS (Continued)

                                                                                             December 31,
CAPITALIZATION AND LIABILITIES                                                       2002                   2001
--------------------------------------------------------------------------------------------------------------------
                                                                                          (in thousands)
<S>                                                                                    <C>                   <C>
Capitalization (See Consolidated Statements of Capitalization):
  Common stock - $2.50 par value - authorized 24,000,000 shares;
    13,370,788 shares outstanding                                                     $33,427               $33,427
  Additional paid-in capital                                                          477,701               422,461
  Retained earnings                                                                   374,428               368,203
  Accumulated other comprehensive loss                                                (18,887)               (2,131)
                                                                            ------------------     -----------------
    Total common equity                                                               866,669               821,960
                                                                            ------------------     -----------------

  Cumulative preferred stock, not mandatorily redeemable                              145,100                29,139
  Cumulative preferred stock, mandatorily redeemable                                        -                24,850
  Long-term debt (excluding current portion)                                          855,389               860,068
                                                                            ------------------     -----------------
                                                                                    1,867,158             1,736,017
                                                                            ------------------     -----------------

--------------------------------------------------------------------------------------------------------------------

Current liabilities:
  Current maturities and sinking funds                                                  5,080                   560
  Notes payable to associated companies                                                     -                38,047
  Accounts payable                                                                     83,126                49,574
  Accounts payable to associated companies                                             41,537                21,194
  Accrued interest                                                                     14,628                14,715
  Accrued taxes                                                                        62,135                70,747
  Accumulated refueling outage provision                                               13,845                 5,614
  Other                                                                                40,946                46,102
                                                                            ------------------     -----------------
                                                                                      261,297               246,553
                                                                            ------------------     -----------------

--------------------------------------------------------------------------------------------------------------------

Other long-term liabilities and deferred credits:
  Accumulated deferred income taxes                                                   313,308               268,010
  Accumulated deferred investment tax credits                                          31,135                34,491
  Pension and other benefit obligations                                                88,449                40,573
  Regulatory liabilities                                                               78,995                 8,520
  Environmental liabilities                                                            39,849                38,206
  Other                                                                                58,215                53,944
                                                                            ------------------     -----------------
                                                                                      609,951               443,744
                                                                            ------------------     -----------------

--------------------------------------------------------------------------------------------------------------------

Commitments and contingencies (Note 11)

--------------------------------------------------------------------------------------------------------------------

Total capitalization and liabilities                                               $2,738,406            $2,426,314
                                                                            ==================     =================

--------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

</TABLE>
                                       97
<PAGE>
<TABLE>
<CAPTION>
                                         INTERSTATE POWER AND LIGHT COMPANY
                                        CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                                                Year Ended December 31,
                                                                       2002              2001              2000
---------------------------------------------------------------------------------------------------------------------
                                                                                     (in thousands)
<S>                                                                        <C>               <C>              <C>
Cash flows from operating activities:
  Net income                                                             $90,877           $98,066          $103,127
  Adjustments to reconcile net income to net cash
   flows from operating activities:
     Depreciation and amortization                                       146,137           148,494           143,471
     Amortization of leased nuclear fuel                                  14,781            12,702            13,867
     Amortization of deferred energy efficiency expenditures               3,956            17,032            25,610
     Deferred tax benefits and investment tax credits                     18,735           (15,155)          (14,486)
     Refueling outage provision                                            8,232            (3,628)            7,787
     Other                                                                   641                93             1,468
  Other changes in assets and liabilities:
     Accounts receivable                                                 (99,485)           78,640           (57,532)
     Accounts payable                                                     30,510           (36,958)           49,111
     Accrued taxes                                                        (8,612)            8,744             3,096
     Adjustment clause balances                                           (7,881)           25,962           (10,252)
     Manufactured gas plants insurance refunds                                 -           (21,541)                -
     Other                                                                52,539            (6,503)            2,297
                                                                  ---------------   ---------------   ---------------
        Net cash flows from operating activities                         250,430           305,948           267,564
                                                                  ---------------   ---------------   ---------------
---------------------------------------------------------------------------------------------------------------------
Cash flows from (used for) financing activities:
     Common stock dividends                                              (81,790)          (80,340)          (80,339)
     Preferred stock dividends                                            (2,862)           (3,410)           (3,403)
     Capital contribution from parent                                     60,000                 -                 -
     Redemption of preferred stock                                       (56,389)                -                 -
     Proceeds from issuance of preferred stock                           144,602                 -                 -
     Proceeds from issuance of long-term debt                                  -           200,000                 -
     Reductions in long-term debt                                           (560)          (89,110)          (51,196)
     Net change in short-term borrowings                                 (38,047)         (131,266)           73,169
     Principal payments under capital lease obligations                  (14,328)           (9,122)          (15,813)
     Other                                                                (4,340)           11,162              (134)
                                                                  ---------------   ---------------   ---------------
       Net cash flows from (used for) financing activities                 6,286          (102,086)          (77,716)
                                                                  ---------------   ---------------   ---------------
---------------------------------------------------------------------------------------------------------------------
Cash flows used for investing activities:
     Utility construction expenditures                                  (247,815)         (193,757)         (171,753)
     Nuclear decommissioning trust funds                                  (6,831)           (6,008)           (6,008)
     Other                                                                 3,919            (4,073)          (12,101)
                                                                  ---------------   ---------------   ---------------
       Net cash flows used for investing activities                     (250,727)         (203,838)         (189,862)
                                                                  ---------------   ---------------   ---------------
---------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash and temporary cash investments             5,989                24               (14)
                                                                  ---------------   ---------------   ---------------
---------------------------------------------------------------------------------------------------------------------
Cash and temporary cash investments at beginning of period                    87                63                77
                                                                  ---------------   ---------------   ---------------
---------------------------------------------------------------------------------------------------------------------
Cash and temporary cash investments at end of period                      $6,076               $87               $63
                                                                  ===============   ===============   ===============
---------------------------------------------------------------------------------------------------------------------
Supplemental cash flows information:
  Cash paid during the period for:
     Interest                                                            $64,430           $63,886           $57,040
                                                                  ===============   ===============   ===============
     Income taxes, net of refunds                                        $39,024           $61,134           $82,254
                                                                  ===============   ===============   ===============
  Noncash investing and financing activities:
     Capital lease obligations incurred and other                        $19,101           $19,967           $20,419
                                                                  ===============   ===============   ===============
---------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

</TABLE>
                                       98
<PAGE>
<TABLE>
<CAPTION>
                                                  INTERSTATE POWER AND LIGHT COMPANY
                                               CONSOLIDATED STATEMENTS OF CAPITALIZATION
                                                                                                      December 31,
                                                                                              2002                   2001
----------------------------------------------------------------------------------------------------------------------------------
                                                                                          (in thousands, except share amounts)

<S>                                                                                                <C>                     <C>
Common equity                                                                                    $866,669                $821,960
                                                                                       -------------------    --------------------
----------------------------------------------------------------------------------------------------------------------------------
Cumulative preferred stock:
   Par/Stated        Authorized         Shares                           Mandatory
     Value             Shares        Outstanding         Series         Redemption
     -----             ------        -----------         ------         ----------
      $25            16,000,000       6,000,000          8.375%             No                    150,000                       -
      $50                 *            100,000            6.10%             No                          -                   5,000
      $50                 *            146,406            4.80%             No                          -                   7,320
      $50                 *            120,000            4.30%             No                          -                   6,000
      $50                **            216,381        4.36% - 7.76%         No                          -                  10,819
      $50                **            545,000            6.40%         $50 / share                     -                  27,250
                                                                                       -------------------    --------------------
                                                                                                  150,000                  56,389
  Less: Unamortized expenses                                                                       (4,900)                 (2,400)
                                                                                       -------------------    --------------------
                                                                                                  145,100                  53,989
                                                                                       -------------------    --------------------
*  466,406 authorized shares in total, fully retired in 2002.   ** 2,000,000 authorized shares in total, fully retired in 2002.
----------------------------------------------------------------------------------------------------------------------------------
Long-term debt:
  Collateral Trust Bonds:
      7.25% series, due 2006                                                                       60,000                  60,000
      6-7/8% series, due 2007                                                                      55,000                  55,000
      6% series, due 2008                                                                          50,000                  50,000
      7% series, due 2023                                                                          50,000                  50,000
      5.5% series, due 2023                                                                        19,400                  19,400
                                                                                       -------------------    --------------------
                                                                                                  234,400                 234,400
  First Mortgage Bonds:
      7-1/4% series, due 2007                                                                      27,450                  27,450
      8% series, due 2007                                                                          25,000                  25,000
      8-5/8% series, due 2021                                                                      20,000                  20,000
      7-5/8% series, due 2023                                                                      94,000                  94,000
                                                                                       -------------------    --------------------
                                                                                                  166,450                 166,450
  Pollution Control Revenue Bonds:
      5.75%, due 2003, partially retired in 2002                                                    2,680                   3,240
      6.25%, due 2009                                                                               1,000                   1,000
      6.30%, due 2010                                                                               5,600                   5,600
      6.35%, due 2012                                                                               5,650                   5,650
      Variable rate (2.8% at December 31, 2002), due 2003 to 2010                                  10,100                  10,100
      Variable/fixed rate series 1998 (4.25% to 4.30% through 2003), due 2005 to 2023              14,950                  14,950
      Variable/fixed rate series 1999 (4.05% to 4.20% through 2004), due 2010 to 2013              10,950                  10,950
                                                                                       -------------------    --------------------
                                                                                                   50,930                  51,490

  Senior debentures, 6-5/8% to 6-3/4%, due 2009 to 2011                                           335,000                 335,000
  Subordinated deferrable interest debentures, 7-7/8%, due 2025                                    50,000                  50,000
  Other, 5.34% at December 31, 2002, due 2006                                                      28,000                  28,000
                                                                                       -------------------    --------------------
                                                                                                  864,780                 865,340
                                                                                       -------------------    --------------------
  Less:
    Current maturities                                                                             (5,080)                   (560)
    Unamortized debt discount, net                                                                 (4,311)                 (4,712)
                                                                                       -------------------    --------------------
                                                                                                  855,389                 860,068
                                                                                       -------------------    --------------------
----------------------------------------------------------------------------------------------------------------------------------
Total capitalization                                                                           $1,867,158              $1,736,017
                                                                                       ===================    ====================
----------------------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

</TABLE>
                                       99
<PAGE>
<TABLE>
<CAPTION>
                                                INTERSTATE POWER AND LIGHT COMPANY
                                        CONSOLIDATED STATEMENTS OF CHANGES IN COMMON EQUITY
                                                                                                            Accumulated
                                                                             Additional                       Other        Total
                                                                 Common       Paid-In       Retained      Comprehensive    Common
                                                                  Stock       Capital       Earnings          Loss         Equity
-----------------------------------------------------------------------------------------------------------------------------------
                                                                                          (in thousands)
<S>                                                                <C>          <C>            <C>             <C>           <C>
2000:
Beginning balance                                                $33,427      $422,011       $334,502            $-       $789,940
      Earnings available for common stock                                                      99,724                       99,724
           Unrealized holding gains on derivatives due to
             cumulative effect of a change in accounting
               principle, net of tax of $38                                                                      54             54
           Other unrealized holding gains on derivatives,
             net of tax of $151                                                                                 212            212
           Less: reclassification adjustment for gains
             included in earnings available for common
               stock, net of tax of $201                                                                        284            284
                                                                                                        ------------  -------------
        Net unrealized losses on qualifying derivatives                                                         (18)           (18)
                                                                                                        ------------  -------------
      Total comprehensive income                                                                                            99,706
    Common stock dividends                                                                    (80,339)                     (80,339)
    Amortization of preferred stock issuance costs and other                       (58)                                        (58)
                                                             ------------  ------------  -------------  ------------  -------------
Ending balance                                                    33,427       421,953        353,887           (18)       809,249

2001:
      Earnings available for common stock                                                      94,656                       94,656
        Reclassification adjustment for losses included
           in earnings available for common stock
             related to derivatives qualified as hedges,
               net of tax of ($12)                                                                               18             18
        Minimum pension liability adjustment, net of
           tax of ($1,469)                                                                                   (2,131)        (2,131)
                                                                                                                      -------------
      Total comprehensive income                                                                                            92,543
    Common stock dividends                                                                    (80,340)                     (80,340)
    Amortization of preferred stock issuance costs and other                       508                                         508
                                                             ------------  ------------  -------------  ------------  -------------
Ending balance                                                    33,427       422,461        368,203        (2,131)       821,960

2002:
      Earnings available for common stock                                                      88,015                       88,015
        Minimum pension liability adjustment, net of
           tax of ($11,844)                                                                                 (16,756)       (16,756)
                                                                                                                      -------------
      Total comprehensive income                                                                                            71,259
    Common stock dividends                                                                    (81,790)                     (81,790)
    Amortization of preferred stock issuance costs and other                      (548)                                       (548)
    Capital contribution from parent                                            60,000                                      60,000
    Redemption of preferred stock                                               (4,212)                                     (4,212)
                                                             ------------  ------------  -------------  ------------  -------------
Ending balance                                                   $33,427      $477,701       $374,428      ($18,887)      $866,669
                                                             ============  ============  =============  ============  =============
-----------------------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
</TABLE>
                                      100
<PAGE>

                      INTERSTATE POWER AND LIGHT COMPANY
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Except as modified below, the Alliant Energy "Notes to Consolidated Financial
Statements" are incorporated by reference insofar as they relate to IP&L and
incorporate the disclosures relating to IP&L contained in the following notes
of the Alliant Energy "Notes to Consolidated Financial Statements":

<TABLE>
<CAPTION>
<S>                                                         <C>
Summary of Significant Accounting Policies      Note 1(a) 3rd and 4th paragraphs, 1(b), 1(c), 1(d), 1(f) to 1(l),
                                                1(n), 1(p), 1(q)
Utility Rate Matters                            Note 2
Leases                                          Note 3
Utility Accounts Receivable                     Note 4
Common and Preferred Stock                      Note 7
Debt                                            Note 8(a) 1st paragraph, 8(b) 1st and 2nd paragraphs
Investments                                     Note 9 1st paragraph
Derivative Financial Instruments                Note 10(a) 1st paragraph, "Cash Flow Hedging Instruments" 1st
                                                paragraph, "Other Derivatives Not Designated in Hedge
                                                Relationships" 4th paragraph; 10(b)
Commitments and Contingencies                   Note 11(b) 1st paragraph, 11(c), 11(e) "MGP Sites" and "NEPA," 11(f)
Jointly-Owned Electric Utility Plant            Note 12

</TABLE>

The notes that follow herein set forth additional specific information for
IP&L and are numbered to be consistent with the Alliant Energy "Notes to
Consolidated Financial Statements."

(1)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a)  General - The consolidated financial statements include the accounts of
IP&L and its consolidated subsidiaries.  IP&L is a direct subsidiary of
Alliant Energy and is engaged principally in the generation, transmission,
distribution and sale of electric energy; the purchase, distribution,
transportation and sale of natural gas; and the provision of steam services
in Iowa, Minnesota and Illinois.

The merger of IPC with and into IESU was approved by their respective
shareowners in April 2001 and by the SEC in October 2001.  The merger was
effective Jan. 1, 2002 and IESU changed its name to IP&L.  Each share of IPC
common stock outstanding was cancelled without payment and each share of IPC
preferred stock outstanding was cancelled and converted into the right to
receive one share of a new class of IESU Class A preferred stock with
substantially identical designations, rights and preferences as the
previously outstanding IPC preferred stock.  IPC and IESU were both
wholly-owned operating subsidiaries of Alliant Energy.  As such, the
transaction was accounted for as a common control merger.  The consolidated
financial statements and notes to consolidated financial statements
illustrate the impact of the merger as if it had occurred as of Jan. 1, 2000.

(c)   Regulatory Assets and Liabilities - At Dec. 31, 2002 and 2001,
regulatory assets and liabilities were comprised of the following items (in
millions):

<TABLE>
<CAPTION>
                                                 Regulatory Assets       Regulatory Liabilities
                                               -----------------------   -----------------------
                                                 2002         2001         2002         2001
                                               ----------   ----------   ----------  -----------
<S>                                               <C>           <C>          <C>         <C>
Tax-related                                      $152.6        $86.3        $69.2       $--
Environmental-related                              45.9         44.4          4.5         4.7
Energy efficiency program costs                     8.1          6.0         --          --
Other                                              11.2          9.9          5.3         3.8
                                               ----------   ----------   ----------  -----------
                                                 $217.8       $146.6        $79.0        $8.5
                                               ==========   ==========   ==========  ===========

</TABLE>

(d)  Income Taxes - Alliant Energy files a consolidated federal income tax
return.  Under the terms of an agreement between Alliant Energy and its
subsidiaries, the subsidiaries calculate their respective federal income tax
provisions and make payments to or receive payments from Alliant Energy as if
they were separate taxable entities.

                                      101
<PAGE>

(3)  LEASES
IP&L's operating lease rental expenses for 2002, 2001 and 2000 were $12.4
million, $11.7 million and $11.6 million, respectively.  The synthetic leases
relate to the financing of the utility railcars that were not included on
IP&L's Consolidated Balance Sheets.  IP&L has guaranteed the residual value of
its synthetic leases totaling $6.8 million in the aggregate.  The guarantees
extend through the maturity of each respective underlying lease with
remaining terms up to seven years.  Residual value guarantees have been
included in the future minimum lease payments noted in the table below (in
millions):

<TABLE>
<CAPTION>
                                                                                                             Present
                                                                                                Less:        value of
                                                                                                amount      net minimum
                                                                                             representing  capital lease
                            2003    2004     2005    2006     2007    Thereafter   Total       interest      payments
                           ------- -------- ------- -------- -------- ----------- --------- -------------- -------------
<S>                          <C>      <C>      <C>      <C>      <C>      <C>         <C>        <C>           <C>
Operating leases             $8.9     $6.5    $4.5     $3.0     $2.4     $30.1       $55.4       n/a           n/a
Synthetic leases              0.4      0.5     5.1      0.3      0.3       2.7         9.3       n/a           n/a
Capital leases               15.1     15.8     9.8     35.5      1.7       1.2        79.1      $9.3          $69.8

</TABLE>

(4)  UTILITY ACCOUNTS RECEIVABLE
At Dec. 31, 2002 and 2001, IP&L had sold $86 million and $90 million of
receivables, respectively.  In 2002, 2001 and 2000, IP&L received $1.1
billion, $1.1 billion and $0.7 billion, respectively, in aggregate proceeds
from the sale of accounts receivable.  IP&L paid fees associated with these
sales of $2.0 million, $3.9 million and $4.0 million in 2002, 2001 and 2000,
respectively.

(5)  INCOME TAXES
The components of income taxes for IP&L were as follows (in millions):

<TABLE>
<CAPTION>
                                                          2002              2001             2000
                                                      --------------    -------------    --------------
<S>                                                         <C>               <C>              <C>
Current tax expense:
  Federal                                                  $28.2             $57.3            $63.3
  State                                                     17.8              11.0             16.4
Deferred tax expense (benefit):
  Federal                                                   22.8              (9.7)            (9.0)
  State                                                     (0.7)             (2.1)            (2.9)
Research and development tax credits                        (2.2)             --               --
Amortization of investment tax credits and other            (3.6)             (3.5)            (2.8)
                                                      --------------    -------------    --------------
                                                           $62.3             $53.0            $65.0
                                                      ==============    =============    ==============
</TABLE>

The overall effective income tax rates shown in the following table were
computed by dividing total income tax expense by income before income taxes.

<TABLE>
<CAPTION>
                                                                  2002              2001              2000
                                                              -------------     -------------    --------------
<S>                                                                <C>               <C>              <C>
Statutory federal income tax rate                                 35.0%             35.0%            35.0%
    State income taxes, net of federal benefits                    7.0               4.5              5.4
    Effect of rate making on property related differences          1.3               3.9              3.8
    Adjustment of prior period taxes                               0.8              (5.5)            (2.8)
    Amortization of investment tax credits                        (2.2)             (2.5)            (2.3)
    Other items, net                                              (1.2)             (0.3)            (0.4)
                                                              -------------     -------------    --------------
Overall effective income tax rate                                 40.7%             35.1%            38.7%
                                                              =============     =============    ==============
</TABLE>
                                      102
<PAGE>

The accumulated deferred income tax (assets) and liabilities included on the
Consolidated Balance Sheets at Dec. 31 arise from the following temporary
differences (in millions):

                                      2002              2001
                                  -------------     -------------
Property related                      $418.9           $327.8
Other                                 (105.6)           (59.8)
                                  -------------     -------------
                                      $313.3           $268.0
                                  =============     =============

(6)  BENEFIT PLANS
(a)  Pension Plans and Other Postretirement Benefits - Substantially all of
IP&L's employees are covered by three non-contributory defined benefit
pension plans.  For the defined benefit pension plan sponsored by Corporate
Services, Alliant Energy allocates pension costs and contributions to IP&L
based on labor costs of plan participants and any additional minimum pension
liability based on each group's funded status.  The weighted-average
assumptions at the measurement date of Sept. 30 were as follows:

<TABLE>
<CAPTION>
                                              Qualified Pension Benefits           Other Postretirement Benefits
                                          ------------------------------------ ---------------------------------------
                                             2002        2001        2000         2002        2001          2000
                                          ----------- ------------------------ ----------- ----------- ---------------
<S>                                         <C>          <C>         <C>         <C>         <C>           <C>
Discount rate                               6.75%        7.25%       8.00%       6.75%       7.25%         8.00%
Expected return on plan assets                9%          9%          9%           9%          9%            9%
Rate of compensation increase                3.5%        3.5%        3.5%         N/A         N/A           N/A
Medical cost trend on covered charges:
      Initial trend rate                     N/A          N/A         N/A        10.8%       12.0%          9.0%
      Ultimate trend rate                    N/A          N/A         N/A          5%          5%            5%

</TABLE>

The components of IP&L's qualified pension benefits and other postretirement
benefits costs were as follows (in millions):

<TABLE>
<CAPTION>
                                             Qualified Pension Benefits            Other Postretirement Benefits
                                        -------------------------------------    ----------------------------------
                                          2002          2001          2000        2002         2001         2000
                                        ---------    -----------    ---------    --------    ---------    ---------
<S>                                        <C>          <C>            <C>         <C>         <C>          <C>
Service cost                               $4.2         $3.4           $3.5        $1.8        $1.5         $1.6
Interest cost                              11.3         10.6           10.1         7.7         6.7          6.3
Expected return on plan assets            (12.8)       (14.4)         (13.7)       (4.0)       (4.5)        (3.8)
Amortization of:
   Transition obligation (asset)           (0.1)        --             --           2.6         2.6          2.8
   Prior service cost                       1.3          1.3            1.2        (0.2)       (0.2)        (0.3)
   Actuarial loss (gain)                    0.3         (1.2)          (1.0)        0.3        (0.9)        (1.1)
                                        ---------    -----------    ---------    --------    ---------    ---------
                                           $4.2        ($0.3)          $0.1        $8.2        $5.2         $5.5
                                        =========    ===========    =========    ========    =========    =========
</TABLE>

The pension benefit cost shown above (and in the following tables) represents
only the pension benefit cost for bargaining unit employees of IP&L covered
under the bargaining unit pension plans that are sponsored by IP&L.  The
benefit obligations and assets associated with IP&L's non-bargaining
employees who are participants in other Alliant Energy plans are reported in
Alliant Energy's consolidated financial statements and are not reported
above.  The pension benefit cost for IP&L's non-bargaining employees who are
now participants in other Alliant Energy plans was $2.7 million, $1.2 million
and $1.9 million for 2002, 2001 and 2000, respectively.  In addition,
Corporate Services provides services to IP&L.  The allocated pension benefit
costs associated with these services was $2.7 million, $2.1 million and $1.9
million for 2002, 2001 and 2000, respectively.  The other postretirement
benefit cost shown above for each period (and in the following tables)
represents the other postretirement benefit cost for all IP&L employees.  The
allocated other postretirement benefit cost associated with Corporate
Services for IP&L was $0.9 million, $0.5 million and $0.4 million for 2002,
2001 and 2000, respectively.
                                      103
<PAGE>

The assumed medical trend rates are critical assumptions in determining the
service and interest cost and accumulated postretirement benefit obligation
related to postretirement benefit costs.  A 1% change in the medical trend
rates for 2002, holding all other assumptions constant, would have the
following effects (in millions):

<TABLE>
<CAPTION>
                                                             1% Increase          1% Decrease
                                                           ----------------     ----------------
<S>                                                             <C>                 <C>
Effect on total of service and interest cost components         $1.1                ($0.9)
Effect on postretirement benefit obligation                     $13.1               ($11.5)

</TABLE>

A reconciliation of the funded status of IP&L's plans to the amounts
recognized on IP&L's Consolidated Balance Sheets at Dec. 31 was as follows
(in millions):

<TABLE>
<CAPTION>
                                                         Qualified Pension Benefits      Other Postretirement Benefits
                                                        -----------------------------    -------------------------------
                                                           2002             2001             2002              2001
                                                        ------------     ------------    -------------     -------------
<S>                                                           <C>            <C>               <C>              <C>
Change in benefit obligation:
  Net benefit obligation at beginning of year               $154.9         $132.8            $107.6           $85.2
  Service cost                                                 4.2            3.4               1.8             1.5
  Interest cost                                               11.3           10.6               7.7             6.7
  Plan participants' contributions                            --             --                 0.3             0.3
  Plan amendments                                              1.1           --                --                --
  Actuarial loss                                              16.3           15.2              17.6            22.0
  Gross benefits paid                                         (7.1)          (7.1)             (6.8)           (8.1)
                                                        ------------     ------------    -------------     -------------
     Net benefit obligation at end of year                   180.7          154.9             128.2           107.6
                                                        ------------     ------------    -------------     -------------

Change in plan assets:
  Fair value of plan assets at beginning of year             145.3          163.1              56.0            63.7
  Actual return on plan assets                                (6.5)         (10.7)             (5.7)           (6.5)
  Employer contributions                                      --             --                 6.8             6.6
  Plan participants' contributions                            --             --                 0.3             0.3
  Gross benefits paid                                         (7.1)          (7.1)             (6.8)           (8.1)
                                                        ------------     ------------    -------------     -------------
     Fair value of plan assets at end of year                131.7          145.3              50.6            56.0
                                                        ------------     ------------    -------------     -------------

Funded status at end of year                                 (49.0)          (9.6)            (77.6)          (51.6)
Unrecognized net actuarial loss                               43.8            8.5              38.3            11.5
Unrecognized prior service cost                               11.0           11.2              (0.4)           (0.7)
Unrecognized net transition obligation (asset)                (0.7)          (0.8)             26.0            28.5
                                                        ------------     ------------    -------------     -------------
     Net amount recognized at end of year                     $5.1           $9.3            ($13.7)         ($12.3)
                                                        ============     ============    =============     =============

Amounts recognized on the Consolidated
  Balance Sheets consist of:
     Prepaid benefit cost                                     $5.9           $9.3              $0.8            $0.8
     Accrued benefit cost                                     (0.8)          --               (14.5)          (13.1)
     Additional minimum liability                            (24.1)          (2.6)             --              --
     Intangible asset                                         11.0            2.3              --              --
     Accumulated other comprehensive loss                     13.1            0.3              --              --
                                                        ------------     ------------    -------------     -------------
      Net amount recognized at measurement date                5.1            9.3             (13.7)          (12.3)
                                                        ------------     ------------    -------------     -------------

Contributions paid after 9/30 and prior to 12/31              --             --                 2.9             1.5
                                                        ------------     ------------    -------------     -------------
     Net amount recognized at 12/31                           $5.1           $9.3            ($10.8)         ($10.8)
                                                        ============     ============    =============     =============
</TABLE>

The projected benefit obligation, accumulated benefit obligation, and fair
value of assets for pension plans with the accumulated benefit obligation in
excess of plan assets are $180.7 million, $150.7 million and $131.7 million,
respectively, as of Sept. 30, 2002 and $37.3 million, $30.4 million and $29.1
million, respectively, as of Sept. 30, 2001.  In addition to the additional
minimum liability in the table above, Corporate Services allocated an
additional minimum liability at Dec. 31, 2002 and 2001 of $24.0 million and
$0, respectively.
                                      104
<PAGE>

Alliant Energy sponsors several non-qualified pension plans that cover
certain current and former key employees.  The pension expense allocated to
IP&L for these plans was $2.7 million, $2.1 million and $2.3 million in 2002,
2001 and 2000, respectively.  IP&L has various life insurance policies that
cover certain key employees and directors.  At both Dec. 31, 2002 and 2001,
the cash surrender value of these investments was $9 million.  A significant
number of IP&L employees also participate in defined contribution pension
plans (401(k) and Employee Stock Ownership plans).  IP&L's contributions to
the plans, which are based on the participants' level of contribution, were
$2.0 million, $2.3 million and $2.5 million in 2002, 2001 and 2000,
respectively.

(7)   COMMON AND PREFERRED STOCK
(b)   Preferred Stock - The carrying value of IP&L's cumulative preferred
stock at Dec. 31, 2002 and 2001 was $145 million and $54 million,
respectively.  The fair market value, based upon the market yield of similar
securities and quoted market prices, at Dec. 31, 2002 and 2001 was $150
million and $50 million, respectively.

(8)   DEBT
(a)   Short-Term Debt - Information regarding IP&L's short-term debt was as
follows (dollars in millions):

<TABLE>
<CAPTION>
                                                      2002             2001
                                                  -------------    --------------
<S>                                                    <C>             <C>
At Dec. 31:
    Money pool borrowings                              $--             $38.0
    Interest rates on money pool borrowings           N/A               2.4%

For the year ended:
    Average amount of short-term debt
        (based on daily outstanding balances)          $35.2           $31.2
    Average interest rates on short-term debt           2.6%            5.9%

</TABLE>

(b)  Long-Term Debt - IP&L's debt maturities for 2003 to 2007 are $5.1
million, $0, $2.7 million, $60.0 million and $107.5 million, respectively.
The carrying value of IP&L's long-term debt (including current maturities) at
Dec. 31, 2002 and 2001 was $860 million and $861 million, respectively.  The
fair market value, based upon the market yield of similar securities and
quoted market prices, at Dec. 31, 2002 and 2001 was $920 million and $872
million, respectively.

(9)  INVESTMENTS AND ESTIMATED FAIR VALUE OF FINANCIAL INSTRUMENTS
Information relating to various investments held by IP&L at Dec. 31 that are
marked-to-market as a result of SFAS 115 was as follows (in
millions):

<TABLE>
<CAPTION>
                                                      2002                          2001
                                           ---------------------------    --------------------------
                                             Carrying/   Unrealized        Carrying/   Unrealized
                                               Fair         Gains,           Fair        Gains,
                                               Value      Net of Tax         Value      Net of Tax
                                           ------------ --------------    ------------ -------------
<S>                                                <C>           <C>            <C>            <C>
Available-for-sale securities:
  Nuclear decommissioning trust funds:
     Debt securities                               $75           $4             $69            $1
     Equity securities                              46            8              48            19
                                           ------------ --------------    ------------ -------------
        Total                                     $121          $12            $117           $20
                                           ============ ==============    ============ =============
</TABLE>

Nuclear Decommissioning Trust Funds - At Dec. 31, 2002, $39 million, $19
million and $17 million of the debt securities mature in 2003-2010, 2011-2020
and 2021-2035, respectively.  The funds realized gains/(losses) from the
sales of securities of $0.1 million, ($0.1) million and ($0.2) million in
2002, 2001 and 2000, respectively (cost of the investments based on specific
identification was $18.9 million, $22.4 million and $11.3 million and
proceeds from the sales were $19.0 million, $22.3 million and $11.1 million,
respectively).
                                      105
<PAGE>

(11)  COMMITMENTS AND CONTINGENCIES
(a)  Construction and Acquisition Expenditures -  Certain commitments have been
made in connection with 2003 capital expenditures.  During 2003, total
construction and acquisition expenditures are estimated to be approximately
$450 million.

(b)  Purchased-Power, Coal and Natural Gas Contracts - Based on the System
Coordination and Operating Agreement, Alliant Energy annually allocates
purchased-power contracts to IP&L and WP&L.  Such process considers factors
such as resource mix, load growth and resource availability.  However, for
2003, system-wide purchased-power contracts of $45.1 million (1.6 million
MWh) have not yet been directly assigned to IP&L and WP&L since the specific
needs of each utility is not yet known.  Refer to Note 18 for additional
information.  Coal contract quantities are directly assigned to specific
plants at IP&L and WP&L based on various factors including projected heat
input requirements, combustion compatibility and efficiency.  However, for
2003-2006, system-wide coal contracts of $56.1 million (7.8 million tons),
$37.5 million (7.6 million tons), $28.0 million (4.7 million tons) and $8.2
million (0.9 million tons), respectively, have not yet been directly assigned
to IP&L and WP&L since the specific needs of each utility is not yet known.
At Dec. 31, 2002, IP&L's minimum commitments were as follows (dollars and
Dths in millions; MWhs and tons in thousands):

<TABLE>
<CAPTION>
                    Purchased-power                Coal                     Natural gas
                ----------------------    ------------------------    -------------------------
                Dollars        MWhs        Dollars        Tons         Dollars         Dths
                ---------    ---------    ----------    ----------    -----------    ----------
<S>                 <C>         <C>           <C>           <C>           <C>            <C>
2003               $38.1        937          $18.0         2,078         $42.5            4
2004                 7.5        142           13.1         1,714           4.2           --
2005                 2.0         --           10.9         1,386           1.0           --
2006                 2.0         --            3.2            --           0.9           --
2007                 0.1         --            2.3            --           1.4           --
Thereafter           0.4         --            --             --            --           --

</TABLE>

(e)  Environmental Liabilities - IP&L had recorded the following
environmental liabilities, and regulatory assets associated with certain of
these liabilities, at Dec. 31 (in millions):

<TABLE>
<CAPTION>
                     Environmental Liabilities             Regulatory Assets
                   -------------------------------    -----------------------------
                       2002              2001            2002             2001
                   -------------     -------------    ------------     ------------
   <S>                   <C>               <C>              <C>              <C>
   MGP sites           $42.4             $39.5            $41.1            $38.5
   NEPA                  4.1               5.1              4.8              5.7
   Other                 0.1               0.3              --               0.2
                   -------------     -------------    ------------     ------------
                       $46.6             $44.9            $45.9            $44.4
                   =============     =============    ============     ============
</TABLE>

MGP Sites - Management currently estimates the range of remaining costs to be
---------
incurred for the investigation, remediation and monitoring of all IP&L's
sites to be approximately $31 million to $57 million.

                                      106
<PAGE>

(13)  SEGMENTS OF BUSINESS
IP&L is a regulated domestic utility, serving customers in Iowa, Minnesota
and Illinois, and includes three segments: a) electric operations; b) gas
operations; and c) other, which includes the steam business and the
unallocated portions of the utility business.  Various line items in the
following tables are not allocated to the electric and gas segments for
management reporting purposes and therefore are included in "Total."
Intersegment revenues were not material to IP&L's operations and there was no
single customer whose revenues were 10% or more of IP&L's consolidated
revenues.  Certain financial information relating to IP&L's significant
business segments was as follows (in millions):

<TABLE>
<CAPTION>
                                                                   Electric          Gas            Other          Total
------------------------------------------------------------------------------------------------------------------------------
2002
----
<S>                                                                    <C>            <C>             <C>           <C>
Operating revenues                                                    $964.9         $214.9          $31.8         $1,211.6
Depreciation and amortization                                          133.3           10.2            2.6            146.1
Operating income                                                       185.1           14.1            6.9            206.1
Interest expense, net of AFUDC                                                                                         62.4
Miscellaneous, net                                                                                                     (9.5)
Income tax expense                                                                                                     62.3
Net income                                                                                                             90.9
Preferred dividends                                                                                                     2.9
Earnings available for common stock                                                                                    88.0
Total assets                                                         2,186.6          315.4          236.4          2,738.4
Construction and acquisition expenditures                              226.8           17.9            3.1            247.8

------------------------------------------------------------------------------------------------------------------------------

2001
----
Operating revenues                                                  $1,003.1         $281.0          $32.2         $1,316.3
Depreciation and amortization                                          134.1           12.4            2.0            148.5
Operating income                                                       184.5            8.7            6.2            199.4
Interest expense, net of AFUDC                                                                                         61.7
Miscellaneous, net                                                                                                    (13.4)
Income tax expense                                                                                                     53.0
Net income                                                                                                             98.1
Preferred dividends                                                                                                     3.4
Earnings available for common stock                                                                                    94.7
Total assets                                                         2,010.1          280.7          135.5          2,426.3
Construction and acquisition expenditures                              170.8           20.1            2.9            193.8

------------------------------------------------------------------------------------------------------------------------------

2000
----
Operating revenues                                                    $955.8         $249.8          $28.4         $1,234.0
Depreciation and amortization                                          129.7           11.8            2.0            143.5
Operating income                                                       207.4           14.4            2.8            224.6
Interest expense, net of AFUDC                                                                                         63.8
Miscellaneous, net                                                                                                     (7.3)
Income tax expense                                                                                                     65.0
Net income                                                                                                            103.1
Preferred dividends                                                                                                     3.4
Earnings available for common stock                                                                                    99.7
Total assets                                                         2,055.6          328.3          140.9          2,524.8
Construction and acquisition expenditures                              150.4           20.6            0.8            171.8

</TABLE>

                                      107
<PAGE>

(15)  SELECTED CONSOLIDATED QUARTERLY FINANCIAL DATA (UNAUDITED)
Summation of the individual quarters may not equal annual totals due to
rounding.

<TABLE>
<CAPTION>
                                                       2002                                      2001
                                      ----------------------------------------  ---------------------------------------
                                       March 31   June 30   Sept. 30  Dec. 31    March 31   June 30  Sept. 30  Dec. 31
                                      ---------- --------- --------- ---------  ---------- --------- -------- ---------
                                                                       (in millions)
  <S>                                      <C>       <C>       <C>       <C>         <C>       <C>       <C>      <C>
  Operating revenues                     $278.8    $269.3    $351.5    $312.0      $395.4    $303.4    $343.5   $274.0
  Operating income                         38.2      34.2      96.6      37.2        40.0      32.8      92.9     33.7
  Net income                               12.9      15.8      45.0      17.2        15.7      12.2      51.3     18.9
  Earnings available for common stock      12.0      14.9      44.3      16.8        14.8      11.3      50.5     18.1

</TABLE>

(18)  RELATED PARTIES
IP&L and WP&L have entered into a System Coordination and Operating
Agreement.  The agreement, which has been approved by FERC, provides a
contractual basis for coordinated planning, construction, operation and
maintenance of the interconnected electric generation and transmission
systems of IP&L and WP&L.  In addition, the agreement allows the
interconnected system to be operated as a single entity with off-system
capacity sales and purchases made to market excess system capability or to
meet system capability deficiencies.  Such sales and purchases are allocated
among IP&L and WP&L based on procedures included in the agreement.  The sales
amounts allocated to IP&L were $27.3 million, $40.6 million and $41.7 million
for 2002, 2001 and 2000, respectively.  The purchases allocated to IP&L were
$138.8 million, $183.1 million and $134.7 million for 2002, 2001 and 2000,
respectively.  The procedures were approved by both FERC and all state
regulatory bodies having jurisdiction over these sales.  Under the agreement,
IP&L and WP&L are fully reimbursed for any generation expense incurred to
support the sale to an affiliate or to a non-affiliate.  Any margins on sales
to non-affiliates are distributed to IP&L and WP&L in proportion to each
utility's share of electric production at the time of the sale.

Pursuant to a service agreement approved by the SEC under PUHCA, IP&L
receives various administrative and general services from an affiliate,
Corporate Services.  These services are billed to IP&L at cost based on
payroll and other expenses incurred by Corporate Services for the benefit of
IP&L.  These costs totaled $182.1 million, $149.5 million and $146.8 million
for 2002, 2001 and 2000, respectively, and consisted primarily of employee
compensation, benefits and fees associated with various professional
services.  At Dec. 31, 2002 and 2001, IP&L had a net intercompany payable to
Corporate Services of $39.1 million and $33.6 million, respectively.

                                      108
<PAGE>

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Shareowners of Wisconsin Power and Light Company:

We have audited the accompanying consolidated balance sheets and statements
of capitalization of Wisconsin Power and Light Company and subsidiaries (the
"Company") as of December 31, 2002 and 2001, and related consolidated
statements of income, cash flows and changes in common equity for each of the
three years in the period ended December 31, 2002.  Our audit also included
the supplemental schedule listed in Item 15(a)(2).  These financial
statements and the supplemental schedule are the responsibility of the
Company's management.  Our responsibility is to express an opinion on these
financial statements and the supplemental schedule based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement.  An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements.  An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation.  We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all
material respects, the financial position of the Company as of December 31,
2002 and 2001, and the results of its operations and its cash flows for each
of the three years in the period ended December 31, 2002 in conformity with
accounting principles generally accepted in the United States of America.
Also, in our opinion, such supplemental schedule, when considered in relation
to the basic consolidated financial statements taken as a whole, presents
fairly in all material respects the information set forth therein.


/s/ DELOITTE & TOUCHE LLP
-------------------------


Milwaukee, Wisconsin
March 18, 2003


                                      109
<PAGE>
<TABLE>
<CAPTION>
                                        WISCONSIN POWER AND LIGHT COMPANY
                                       CONSOLIDATED STATEMENTS OF INCOME

                                                                       Year Ended December 31,
                                                            2002                   2001               2000
-----------------------------------------------------------------------------------------------------------------
                                                                             (in thousands)
<S>                                                             <C>                  <C>                  <C>
Operating revenues:
  Electric utility                                            $787,680             $753,450             $692,191
  Gas utility                                                  179,091              206,863              165,152
  Water                                                          5,307                5,040                5,038
                                                      -----------------    -----------------    -----------------
                                                               972,078              965,353              862,381
                                                      -----------------    -----------------    -----------------
-----------------------------------------------------------------------------------------------------------------
Operating expenses:
  Electric production fuels                                    132,492              120,722              113,208
  Purchased power                                              217,209              217,306              146,939
  Cost of gas sold                                             110,119              153,823              107,131
  Other operation and maintenance                              215,689              186,477              188,967
  Depreciation and amortization                                136,232              129,098              139,911
  Taxes other than income taxes                                 32,874               32,504               29,163
                                                      -----------------    -----------------    -----------------
                                                               844,615              839,930              725,319
                                                      -----------------    -----------------    -----------------
-----------------------------------------------------------------------------------------------------------------
Operating income                                               127,463              125,423              137,062
                                                      -----------------    -----------------    -----------------
-----------------------------------------------------------------------------------------------------------------
Interest expense and other:
  Interest expense                                              40,202               43,483               44,644
  Interest income                                              (21,590)              (8,109)             (13,143)
  Equity income from unconsolidated investments                (17,022)             (15,535)                (552)
  Allowance for funds used during construction                  (2,639)              (4,753)              (5,365)
  Miscellaneous, net                                             2,864               (4,391)              (2,841)
                                                      -----------------    -----------------    -----------------
                                                                 1,815               10,695               22,743
                                                      -----------------    -----------------    -----------------
-----------------------------------------------------------------------------------------------------------------
Income before income taxes                                     125,648              114,728              114,319
                                                      -----------------    -----------------    -----------------
-----------------------------------------------------------------------------------------------------------------
Income taxes                                                    44,724               41,238               42,918
                                                      -----------------    -----------------    -----------------
-----------------------------------------------------------------------------------------------------------------
Income before cumulative effect of a change
   in accounting principle, net of tax                          80,924               73,490               71,401
                                                      -----------------    -----------------    -----------------
-----------------------------------------------------------------------------------------------------------------
Cumulative effect of a change in accounting
   principle, net of tax                                             -                    -                   35
                                                      -----------------    -----------------    -----------------
-----------------------------------------------------------------------------------------------------------------
Net income                                                      80,924               73,490               71,436
                                                      -----------------    -----------------    -----------------
-----------------------------------------------------------------------------------------------------------------
Preferred dividend requirements                                  3,310                3,310                3,310
                                                      -----------------    -----------------    -----------------
-----------------------------------------------------------------------------------------------------------------
Earnings available for common stock                            $77,614              $70,180              $68,126
                                                      =================    =================    =================
-----------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
</TABLE>
                                      110
<PAGE>


<TABLE>
<CAPTION>
                                        WISCONSIN POWER AND LIGHT COMPANY
                                           CONSOLIDATED BALANCE SHEETS

                                                                                          December 31,
ASSETS                                                                            2002                 2001
------------------------------------------------------------------------------------------------------------------
                                                                                        (in thousands)
<S>                                                                                  <C>                  <C>
Property, plant and equipment:
  Electric plant in service                                                       $1,843,834           $1,779,593
  Gas plant in service                                                               286,652              280,881
  Water plant in service                                                              33,062               32,497
  Other plant in service                                                             242,329              243,121
  Accumulated depreciation                                                        (1,410,036)          (1,328,111)
                                                                            -----------------    -----------------
    Net plant                                                                        995,841            1,007,981
  Construction work in progress                                                       96,746               37,828
  Other, net                                                                          17,811               18,085
                                                                            -----------------    -----------------
                                                                                   1,110,398            1,063,894
                                                                            -----------------    -----------------
------------------------------------------------------------------------------------------------------------------
Current assets:
  Cash and temporary cash investments                                                  8,577                  307
  Accounts receivable:
    Customer, less allowance for doubtful accounts of $1,770 and $1,543                7,977               33,190
    Associated companies                                                              21,484                3,676
    Other, less allowance for doubtful accounts of $458 and $-                        18,191               16,571
  Production fuel, at average cost                                                    18,980               17,314
  Materials and supplies, at average cost                                             22,133               20,669
  Gas stored underground, at average cost                                             16,679               22,187
  Regulatory assets                                                                   27,999                5,163
  Prepaid gross receipts tax                                                          27,388               25,673
  Other                                                                                8,599                7,855
                                                                            -----------------    -----------------
                                                                                     178,007              152,605
                                                                            -----------------    -----------------
------------------------------------------------------------------------------------------------------------------
Investments:
  Nuclear decommissioning trust funds                                                223,734              215,794
  Investment in ATC and other                                                        133,043              127,941
                                                                            -----------------    -----------------
                                                                                     356,777              343,735
                                                                            -----------------    -----------------
------------------------------------------------------------------------------------------------------------------
Other assets:
  Regulatory assets                                                                  102,674              109,864
  Deferred charges and other                                                         236,741              205,702
                                                                            -----------------    -----------------
                                                                                     339,415              315,566
                                                                            -----------------    -----------------
------------------------------------------------------------------------------------------------------------------
Total assets                                                                      $1,984,597           $1,875,800
                                                                            =================    =================
------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

</TABLE>
                                      111
<PAGE>
<TABLE>
<CAPTION>
                                         WISCONSIN POWER AND LIGHT COMPANY
                                      CONSOLIDATED BALANCE SHEETS (Continued)

                                                                                           December 31,
CAPITALIZATION AND LIABILITIES                                                      2002                   2001
--------------------------------------------------------------------------------------------------------------------
                                                                                          (in thousands)
<S>    <C>                                                                              <C>                   <C>
Capitalization (See Consolidated Statements of Capitalization):
  Common stock - $5 par value - authorized 18,000,000 shares;
       13,236,601 shares outstanding                                                  $66,183               $66,183
  Additional paid-in capital                                                          325,603               264,603
  Retained earnings                                                                   399,302               381,333
  Accumulated other comprehensive loss                                                (24,108)              (10,167)
                                                                            ------------------     -----------------
    Total common equity                                                               766,980               701,952
                                                                            ------------------     -----------------

  Cumulative preferred stock                                                           59,963                59,963
  Long-term debt (excluding current portion)                                          468,208               468,083
                                                                            ------------------     -----------------
                                                                                    1,295,151             1,229,998
                                                                            ------------------     -----------------
--------------------------------------------------------------------------------------------------------------------
Current liabilities:
  Variable rate demand bonds                                                           55,100                55,100
  Commercial paper                                                                     60,000                     -
  Notes payable to associated companies                                                     -                90,816
  Accounts payable                                                                     90,869                94,091
  Accounts payable to associated companies                                             43,276                25,231
  Accrued taxes                                                                        19,353                 2,057
  Regulatory liabilities                                                               16,938                 7,619
  Other                                                                                29,064                25,543
                                                                            ------------------     -----------------
                                                                                      314,600               300,457
                                                                            ------------------     -----------------
--------------------------------------------------------------------------------------------------------------------
Other long-term liabilities and deferred credits:
  Accumulated deferred income taxes                                                   191,894               206,245
  Accumulated deferred investment tax credits                                          23,241                24,907
  Pension and other benefit obligations                                                58,921                18,175
  Customer advances                                                                    36,555                34,178
  Other                                                                                64,235                61,840
                                                                            ------------------     -----------------
                                                                                      374,846               345,345
                                                                            ------------------     -----------------
--------------------------------------------------------------------------------------------------------------------
Commitments and contingencies (Note 11)
--------------------------------------------------------------------------------------------------------------------
Total capitalization and liabilities                                               $1,984,597            $1,875,800
                                                                            ==================     =================
--------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

</TABLE>
                                      112
<PAGE>
<TABLE>
<CAPTION>
                                                WISCONSIN POWER AND LIGHT COMPANY
                                              CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                                                    Year Ended December 31,
                                                                          2002                2001               2000
---------------------------------------------------------------------------------------------------------------------------
                                                                                          (in thousands)
<S>                                                                          <C>                <C>                <C>
Cash flows from operating activities:
  Net income                                                                 $80,924            $73,490            $71,436
  Adjustments to reconcile net income to net cash
   flows from operating activities:
     Depreciation and amortization                                           136,232            129,098            139,911
     Amortization of nuclear fuel                                              6,486              4,554              5,066
     Amortization of deferred energy efficiency expenditures                  21,179             14,361             14,361
     Deferred tax benefits and investment tax credits                         (5,562)            (6,791)           (12,077)
     Equity income from unconsolidated investments, net                      (17,022)           (15,535)              (552)
     Distributions from equity method investments                             13,199              8,450                992
     Other                                                                   (22,160)           (10,539)           (15,451)
  Other changes in assets and liabilities:
     Accounts receivable                                                       5,785             14,408            (29,733)
     Accounts payable                                                        (11,676)           (20,549)            36,265
     Accrued taxes                                                            17,296             (1,225)            (3,257)
     Other                                                                      (931)           (53,836)           (32,901)
                                                                     ----------------    ---------------    ---------------
       Net cash flows from operating activities                              223,750            135,886            174,060
                                                                     ----------------    ---------------    ---------------
---------------------------------------------------------------------------------------------------------------------------
Cash flows used for financing activities:
    Common stock dividends                                                   (59,645)           (60,449)                 -
    Preferred stock dividends                                                 (3,310)            (3,310)            (3,310)
    Capital contribution from parent                                          61,000             35,000                  -
    Proceeds from issuance of long-term debt                                       -                  -            100,000
    Reductions in long-term debt                                                   -            (47,000)            (1,875)
    Net change in short-term borrowings                                      (30,816)            61,572            (96,505)
    Other                                                                      5,086             (4,989)             2,677
                                                                     ----------------    ---------------    ---------------
      Net cash flows used for financing activities                           (27,685)           (19,176)               987
                                                                     ----------------    ---------------    ---------------
---------------------------------------------------------------------------------------------------------------------------
Cash flows used for investing activities:
    Utility construction expenditures                                       (156,921)          (147,032)          (131,640)
    Nuclear decommissioning trust funds                                      (16,092)           (16,092)           (16,092)
    Proceeds from formation of ATC and other asset dispositions                    -             75,600                961
    Other                                                                    (14,782)           (29,308)           (28,109)
                                                                     ----------------    ---------------    ---------------
      Net cash flows used for investing activities                          (187,795)          (116,832)          (174,880)
                                                                     ----------------    ---------------    ---------------
---------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash and temporary cash investments                 8,270               (122)               167
                                                                     ----------------    ---------------    ---------------
---------------------------------------------------------------------------------------------------------------------------
Cash and temporary cash investments at beginning of period                       307                429                262
                                                                     ----------------    ---------------    ---------------
---------------------------------------------------------------------------------------------------------------------------
Cash and temporary cash investments at end of period                          $8,577               $307               $429
                                                                     ================    ===============    ===============
---------------------------------------------------------------------------------------------------------------------------
Supplemental cash flows information:
  Cash paid during the period for:
    Interest                                                                 $39,540            $43,237            $40,455
                                                                     ================    ===============    ===============
    Income taxes, net of refunds                                             $35,875            $54,161            $54,676
                                                                     ================    ===============    ===============
---------------------------------------------------------------------------------------------------------------------------
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
</TABLE>
                                      113
<PAGE>
<TABLE>
<CAPTION>
                                               WISCONSIN POWER AND LIGHT COMPANY
                                           CONSOLIDATED STATEMENTS OF CAPITALIZATION
                                                                                                December 31,
                                                                                         2002                  2001
-------------------------------------------------------------------------------------------------------------------------
                                                                                  (in thousands, except share amounts)
<S>                                                                                         <C>                   <C>
Common equity                                                                             $766,980              $701,952
                                                                                 ------------------    ------------------
-------------------------------------------------------------------------------------------------------------------------
Cumulative preferred stock:
    Cumulative, without par value, not mandatorily redeemable - authorized
      3,750,000 shares, maximum aggregate stated value $150,000,000:
        $100 stated value - 4.50% series, 99,970 shares outstanding                          9,997                 9,997
        $100 stated value - 4.80% series, 74,912 shares outstanding                          7,491                 7,491
        $100 stated value - 4.96% series, 64,979 shares outstanding                          6,498                 6,498
        $100 stated value - 4.40% series, 29,957 shares outstanding                          2,996                 2,996
        $100 stated value - 4.76% series, 29,947 shares outstanding                          2,995                 2,995
        $100 stated value - 6.20% series, 150,000 shares outstanding                        15,000                15,000
          $25 stated value - 6.50% series, 599,460 shares outstanding                       14,986                14,986
                                                                                 ------------------    ------------------
                                                                                            59,963                59,963
                                                                                 ------------------    ------------------
-------------------------------------------------------------------------------------------------------------------------
Long-term debt:
    First Mortgage Bonds:
      1984 Series A, variable rate (1.6% at December 31, 2002), due 2014                     8,500                 8,500
      1988 Series A, variable rate (2.1% at December 31, 2002), due 2015                    14,600                14,600
      1991 Series A, variable rate (1.85% at December 31, 2002), due 2015                   16,000                16,000
      1991 Series B, variable rate (1.85% at December 31, 2002), due 2005                   16,000                16,000
      1992 Series W, 8.6%, due 2027                                                         70,000                70,000
      1992 Series X, 7.75%, due 2004                                                        62,000                62,000
      1992 Series Y, 7.6%, due 2005                                                         72,000                72,000
                                                                                 ------------------    ------------------
                                                                                           259,100               259,100
    Debentures, 7%, due 2007                                                               105,000               105,000
    Debentures, 5.7%, due 2008                                                              60,000                60,000
    Debentures, 7-5/8%, due 2010                                                           100,000               100,000
                                                                                 ------------------    ------------------
                                                                                           524,100               524,100
                                                                                 ------------------    ------------------
    Less:
       Variable rate demand bonds                                                          (55,100)              (55,100)
       Unamortized debt discount, net                                                         (792)                 (917)
                                                                                 ------------------    ------------------
                                                                                           468,208               468,083
                                                                                 ------------------    ------------------
-------------------------------------------------------------------------------------------------------------------------
Total capitalization                                                                    $1,295,151            $1,229,998
                                                                                 ==================    ==================
-------------------------------------------------------------------------------------------------------------------------

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

</TABLE>
                                      114
<PAGE>
<TABLE>
<CAPTION>
                                                WISCONSIN POWER AND LIGHT COMPANY
                                       CONSOLIDATED STATEMENTS OF CHANGES IN COMMON EQUITY
                                                                                                             Accumulated
                                                                                  Additional                    Other        Total
                                                                     Common        Paid-In      Retained     Comprehensive   Common
                                                                      Stock        Capital      Earnings         Loss        Equity
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                (in thousands)
<S>                                                                      <C>         <C>          <C>             <C>         <C>
2000:
Beginning balance                                                       $66,183    $229,438     $303,476           $--     $599,097
      Earnings available for common stock                                                         68,126                     68,126
          Unrealized holding losses on derivatives due to cumulative
             effect of a change in accounting principle,
               net of tax of ($430)                                                                                (642)       (642)
          Other unrealized holding losses on derivatives,
             net of tax of ($3,634)                                                                              (5,151)     (5,151)
          Less: reclassification adjustment for losses
             included in earnings available for common
               stock, net of tax of ($769)                                                                       (1,085)     (1,085)
                                                                                                          -------------- -----------
        Net unrealized losses on qualifying derivatives                                                          (4,708)     (4,708)
                                                                                                          -------------- -----------
      Total comprehensive income                                                                                             63,418
    Stock options exercised                                                              78                                      78
                                                                     ----------- ----------- ------------ -------------- -----------
Ending balance                                                           66,183     229,516      371,602         (4,708)    662,593

2001:
      Earnings available for common stock                                                         70,180                     70,180
        Minimum pension liability adjustment, net of tax of ($9,552)                                            (14,248)    (14,248)
          Unrealized holding gains on derivatives,
             net of tax of $3,932                                                                                 5,952       5,952
          Less: reclassification adjustment for losses
             included in earnings available for common
               stock, net of tax of ($1,676)                                                                     (2,837)     (2,837)
                                                                                                          -------------- -----------
        Net unrealized gains on qualifying derivatives                                                            8,789       8,789
                                                                                                          -------------- -----------
      Total comprehensive income                                                                                             64,721
    Common stock dividends                                                                       (60,449)                   (60,449)
    Stock options exercised                                                              87                                      87
    Capital contribution from parent                                                 35,000                                  35,000
                                                                     ----------- ----------- ------------ -------------- -----------
Ending balance                                                           66,183     264,603      381,333        (10,167)    701,952

2002:
      Earnings available for common stock                                                         77,614                     77,614
        Minimum pension liability adjustment, net of tax of ($6,823)                                            (10,177)    (10,177)
          Unrealized holding losses on derivatives,
             net of tax of ($92)                                                                                   (137)       (137)
          Less: reclassification adjustment for gains
             included in earnings available for common
               stock, net of tax of $2,432                                                                        3,627       3,627
                                                                                                          -------------- -----------
        Net unrealized losses on qualifying derivatives                                                          (3,764)     (3,764)
                                                                                                          -------------- -----------
      Total comprehensive income                                                                                             63,673
    Common stock dividends                                                                       (59,645)                   (59,645)
    Capital contribution from parent                                                 61,000                                  61,000
                                                                     ----------- ----------- ------------ -------------- -----------
Ending balance                                                          $66,183    $325,603     $399,302       ($24,108)   $766,980
                                                                     =========== =========== ============ ============== ===========
------------------------------------------------------------------------------------------------------------------------------------
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
</TABLE>
                                      115
<PAGE>

                       WISCONSIN POWER AND LIGHT COMPANY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Except as modified below, the Alliant Energy "Notes to Consolidated Financial
Statements" are incorporated by reference insofar as they relate to WP&L and
incorporate the disclosures relating to WP&L contained in the following notes
of the Alliant Energy "Notes to Consolidated Financial Statements":

<TABLE>
<CAPTION>
<S>                                                        <C>
Summary of Significant Accounting Policies      Note 1(a) 3rd and 4th paragraphs, 1(b), 1(c), 1(d), 1(f) to 1(l),
                                                1(n), 1(p), 1(q)
Utility Rate Matters                            Note 2
Leases                                          Note 3
Utility Accounts Receivable                     Note 4
Common and Preferred Stock                      Note 7
Debt                                            Note 8(a) 1st paragraph, 8(b) 1st paragraph
Investments                                     Note 9 1st paragraph, "Investment in ATC"
Derivative Financial Instruments                Note 10(a) 1st paragraph, "Cash Flow Hedging Instruments" 1st
                                                paragraph, "Other Derivatives Not Designated in Hedge Relationships"
                                                4th paragraph; 10(b); 10(c)
Commitments and Contingencies                   Note 11(b) 1st paragraph, 11(c), 11(e) "MGP Sites" and "NEPA," 11(f)
Jointly-Owned Electric Utility Plant            Note 12

</TABLE>

The notes that follow herein set forth additional specific information for
WP&L and are numbered to be consistent with the Alliant Energy "Notes to
Consolidated Financial Statements."

(1)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a)  General - The consolidated financial statements include the accounts of
WP&L and its principal consolidated subsidiaries WPL Transco LLC and South
Beloit.  WP&L is a direct subsidiary of Alliant Energy and is engaged
principally in the generation, distribution and sale of electric energy; the
purchase, distribution, transportation and sale of natural gas; and the
provision of water services.  Nearly all of WP&L's retail customers are
located in south and central Wisconsin.

(c)  Regulatory Assets and Liabilities - At Dec. 31, 2002 and 2001,
regulatory assets and liabilities were comprised of the following items (in
millions):

<TABLE>
<CAPTION>
                                           Regulatory Assets     Regulatory Liabilities
                                         ----------------------  -----------------------
                                           2002        2001         2002        2001
                                         ----------  ----------  -----------  ----------
<S>                                          <C>         <C>          <C>          <C>
Energy efficiency program costs             $38.6       $33.9        $--          $--
Tax-related                                  25.0        29.0        14.6         15.1
Environmental-related                        19.0        18.7         0.6          0.5
Other                                        48.1        33.4        17.0          7.6
                                         ----------  ----------  -----------  ----------
                                           $130.7      $115.0       $32.2        $23.2
                                         ==========  ==========  ===========  ==========
</TABLE>

(d)  Income Taxes - Alliant Energy files a consolidated federal income tax
return.  Under the terms of an agreement between Alliant Energy and its
subsidiaries, the subsidiaries calculate their respective federal income tax
provisions and make payments to or receive payments from Alliant Energy as if
they were separate taxable entities.

(3)  LEASES
WP&L's operating lease rental expenses, which include certain purchased-power
agreements, for 2002, 2001 and 2000 were $24.5 million, $23.4 million and
$7.9 million, respectively.  The purchased-power agreements below include
$463 million and $78 million, respectively, related to a new plant
(Riverside) currently under development and the RockGen plant, both in
Wisconsin.  The Riverside plant is expected to be placed in-service in 2004.
The synthetic leases relate to the financing of the utility railcars and a
utility radio dispatch system that were not included on WP&L's Consolidated
Balance Sheets.  WP&L has guaranteed the residual value of its synthetic
leases totaling $14.3 million in the aggregate.  The guarantees extend
through the maturity of each respective underlying lease with remaining terms

                                      116
<PAGE>

up to 13 years.  Residual value guarantees have been included in the future
minimum lease payments noted in the table below (in millions):

<TABLE>
<CAPTION>
                                                2003     2004     2005     2006     2007    Thereafter   Total
                                              -------- -------- -------- -------- -------- ----------- ---------
  <S>                                            <C>      <C>      <C>      <C>      <C>      <C>         <C>
  Certain purchased-power agreements            $18.7    $51.8    $66.3    $67.6    $69.0    $308.6      $582.0
  Synthetic leases                                6.4      7.6      7.5      7.4      5.5      25.5        59.9
  Other                                           2.0      1.1      1.2      1.0      1.0       2.2         8.5
                                              -------- -------- -------- -------- -------- ----------- ---------
                                                $27.1    $60.5    $75.0    $76.0    $75.5    $336.3      $650.4
                                              ======== ======== ======== ======== ======== =========== =========
</TABLE>

(4)  UTILITY ACCOUNTS RECEIVABLE
At Dec. 31, 2002 and 2001, WP&L had sold $116 million and $88 million of
receivables, respectively.  In 2002, 2001 and 2000, WP&L received $1.2
billion, $1.1 billion and $0.9 billion, respectively, in aggregate proceeds
from the sale of accounts receivable.  WP&L paid fees associated with these
sales of $2.2 million, $4.0 million and $5.0 million in 2002, 2001 and 2000,
respectively.

(5)  INCOME TAXES
The components of income taxes for WP&L were as follows (in millions):

<TABLE>
<CAPTION>
                                                 2002             2001              2000
                                             -------------    -------------     -------------
<S>                                                <C>              <C>               <C>
Current tax expense:
  Federal                                         $42.8            $36.8             $44.5
  State                                             9.7             11.2              10.5
Deferred tax expense (benefit):
  Federal                                          (5.0)            (4.6)             (9.9)
  State                                             1.2             (0.4)             (0.3)
Amortization of investment tax credits             (1.8)            (1.8)             (1.9)
Research and development tax credits               (2.2)            --                --
                                             -------------    -------------     -------------
                                                  $44.7            $41.2             $42.9
                                             =============    =============     =============
</TABLE>

The overall effective income tax rates shown in the following table were
computed by dividing total income tax expense by income before income taxes.

<TABLE>
<CAPTION>
                                                      2002               2001               2000
                                                  -------------      --------------     --------------
<S>                                                    <C>                <C>                <C>
Statutory federal income tax rate                      35.0%              35.0%              35.0%
    State income taxes, net of federal benefits         6.1                6.4                6.0
    Adjustment of prior period taxes                   (1.1)              (2.8)              (0.8)
    Amortization of investment tax credits             (1.4)              (1.6)              (1.6)
    Amortization of excess deferred taxes              (1.4)              (1.5)              (1.3)
    Research and development tax credits               (1.8)              --                 --
    Other items, net                                    0.2                0.4                0.2
                                                  -------------      --------------     --------------
Overall effective income tax rate                      35.6%              35.9%              37.5%
                                                  =============      ==============     ==============
</TABLE>

The accumulated deferred income tax (assets) and liabilities included on the
Consolidated Balance Sheets at Dec. 31 arise from the following temporary
differences (in millions):
                                       2002               2001
                                  ---------------    ---------------
Property related                       $201.2             $200.8
Minimum pension liability               (16.4)              (9.6)
Decommissioning                         (25.2)             (20.8)
Other                                    32.3               35.8
                                  ---------------    ---------------
                                       $191.9             $206.2
                                  ===============    ===============

                                      117
<PAGE>

(6)  BENEFIT PLANS
(a)  Pension Plans and Other Postretirement Benefits - Substantially all of
WP&L's employees are covered by two non-contributory defined benefit pension
plans.  For the defined benefit pension plan sponsored by Corporate Services,
Alliant Energy allocates pension costs and contributions to WP&L based on
labor costs of plan participants and any additional minimum pension liability
based on each group's funded status.  The weighted-average assumptions at the
measurement date of Sept. 30 were as follows:

<TABLE>
<CAPTION>
                                               Qualified Pension Benefits            Other Postretirement Benefits
                                          ------------------------------------- ----------------------------------------
                                             2002         2001        2000         2002        2001           2000
                                          ------------ ----------- ------------ ----------- ------------- ---------------
<S>                                          <C>         <C>          <C>          <C>         <C>           <C>
Discount rate                                6.75%       7.25%        8.00%        6.75%       7.25%         8.00%
Expected return on plan assets                9%           9%          9%           9%          9%             9%
Rate of compensation increase                3.5%         3.5%        3.5%         3.5%        3.5%           3.5%
Medical cost trend on covered charges:
      Initial trend rate                      N/A         N/A          N/A         10.8%       12.0%          9.0%
      Ultimate trend rate                     N/A         N/A          N/A          5%          5%             5%

</TABLE>

The components of WP&L's qualified pension benefits and other postretirement
benefits costs were as follows (in millions):

<TABLE>
<CAPTION>
                                                Qualified Pension Benefits            Other Postretirement Benefits
                                           --------------------------------------    ---------------------------------
                                             2002           2001         2000         2002        2001         2000
                                           ----------    -----------   ----------    --------    --------    ---------
<S>                                            <C>          <C>           <C>          <C>         <C>         <C>
Service cost                                   $3.6         $2.8          $3.0         $2.4        $1.6        $1.4
Interest cost                                  10.1          9.2           8.9          4.4         3.6         3.3
Expected return on plan assets                (12.2)       (13.7)        (12.9)        (1.6)       (1.7)       (1.6)
Amortization of:
   Transition obligation (asset)               (1.7)        (2.1)         (2.1)         1.1         1.2         1.2
   Prior service cost                           0.4          0.5           0.4          --          --          --
   Actuarial loss (gain)                        1.5          --            --           0.1        (0.6)       (0.8)
                                           ----------    -----------   ----------    --------    --------    ---------
                                               $1.7        ($3.3)        ($2.7)        $6.4        $4.1        $3.5
                                           ==========    ===========   ==========    ========    ========    =========
</TABLE>

The pension benefit cost shown above (and in the following tables) represents
only the pension benefit cost for bargaining unit employees of WP&L covered
under the bargaining unit pension plan that is sponsored by WP&L.  The
benefit obligations and assets associated with WP&L's non-bargaining
employees who are participants in other Alliant Energy plans are reported in
Alliant Energy's consolidated financial statements and are not reported
above.  The pension benefit (income) cost for WP&L's non-bargaining employees
who are now participants in other Alliant Energy plans was $0.3 million,
($1.5) million and ($1.3) million for 2002, 2001 and 2000, respectively.  In
addition, Corporate Services provides services to WP&L.  The allocated
pension benefit costs associated with these services was $1.7 million, $1.3
million and $1.3 million for 2002, 2001 and 2000, respectively.  The other
postretirement benefit cost shown above for each period (and in the following
tables) represents the other postretirement benefit cost for all WP&L
employees.  The allocated other postretirement benefit cost associated with
Corporate Services for WP&L was $0.5 million, $0.3 million and $0.3 million
for 2002, 2001 and 2000, respectively.

The assumed medical trend rates are critical assumptions in determining the
service and interest cost and accumulated postretirement benefit obligation
related to postretirement benefit costs.  A one percent change in the medical
trend rates for 2002, holding all other assumptions constant, would have the
following effects (in millions):

<TABLE>
<CAPTION>
                                                                1% Increase             1% Decrease
                                                           -------------------    ----------------------
<S>                                                               <C>                    <C>
Effect on total of service and interest cost components           $0.6                   ($0.6)
Effect on postretirement benefit obligation                       $5.6                   ($5.1)

</TABLE>
                                      118
<PAGE>

A reconciliation of the funded status of WP&L's plans to the amounts
recognized on WP&L's Consolidated Balance Sheets at Dec. 31 was as follows
(in millions):

<TABLE>
<CAPTION>
                                                      Qualified Pension Benefits      Other Postretirement Benefits
                                                     -----------------------------    -------------------------------
                                                        2002             2001             2002              2001
                                                     ------------     ------------    --------------     ------------
<S>                                                      <C>              <C>              <C>               <C>
Change in benefit obligation:
  Net benefit obligation at beginning of year           $139.2           $115.9           $60.5             $42.3
  Service cost                                             3.6              2.8             2.4               1.6
  Interest cost                                           10.1              9.2             4.4               3.6
  Plan participants' contributions                         --              --               1.5               1.6
  Actuarial loss                                          10.3             18.3            13.2              16.6
  Gross benefits paid                                     (7.2)            (7.0)           (5.4)             (5.2)
                                                     ------------     ------------    --------------     ------------
     Net benefit obligation at end of year               156.0            139.2            76.6              60.5
                                                     ------------     ------------    --------------     ------------

Change in plan assets:
  Fair value of plan assets at beginning of year         138.8            156.3            17.8              19.4
  Actual return on plan assets                            (8.1)           (10.5)           (1.4)             (0.5)
  Employer contributions                                  30.0             --               4.2               2.5
  Plan participants' contributions                         --              --               1.5               1.6
  Gross benefits paid                                     (7.2)            (7.0)           (5.4)             (5.2)
                                                     ------------     ------------    --------------     ------------
     Fair value of plan assets at end of year            153.5            138.8            16.7              17.8
                                                     ------------     ------------    --------------     ------------

Funded status at end of year                              (2.5)            (0.4)          (59.9)            (42.7)
Unrecognized net actuarial loss                           63.5             34.3            20.4               4.4
Unrecognized prior service cost                            3.4              3.9            (0.1)             (0.2)
Unrecognized net transition obligation (asset)             --              (1.7)           11.5              12.6
                                                     ------------     ------------    --------------     ------------
     Net amount recognized at end of year                $64.4            $36.1          ($28.1)           ($25.9)
                                                     ============     ============    ==============     ============

Amounts recognized on the Consolidated
  Balance Sheets consist of:
     Prepaid benefit cost                                $64.4            $36.1            $1.5              $1.3
     Accrued benefit cost                                  --              --             (29.6)            (27.2)
                                                     ------------     ------------    --------------     ------------
      Net amount recognized at measurement date           64.4             36.1           (28.1)            (25.9)
                                                     ------------     ------------    --------------     ------------

Contributions paid after 9/30 and prior to 12/31           --              --               1.0               1.1
                                                     ------------     ------------    --------------     ------------
     Net amount recognized at 12/31                      $64.4            $36.1          ($27.1)           ($24.8)
                                                     ============     ============    ==============     ============
</TABLE>

The benefit obligation and fair value of plan assets for the postretirement
welfare plans with benefit obligations in excess of plan assets were $74.7
million and $13.7 million, respectively, as of Sept. 30, 2002 and $53.8
million and $8.5 million, respectively, as of Sept. 30, 2001.  At Dec. 31,
2002 and 2001, Corporate Services allocated an additional minimum liability
of $41.3 million and $0 million, respectively.

Alliant Energy sponsors several non-qualified pension plans that cover
certain current and former key employees.  The pension expense allocated to
WP&L for these plans was $1.5 million, $1.0 million and $1.2 million in 2002,
2001 and 2000, respectively.  WP&L has various life insurance policies that
cover certain key employees and directors.  At Dec. 31, 2002 and 2001, the
cash surrender value of these investments was $10 million and $9 million,
respectively.  A significant number of WP&L employees also participate in
defined contribution pension plans (401(k) plans).  WP&L's contributions to
the plans, which are based on the participants' level of contribution, were
$2.2 million, $2.1 million and $2.1 million in 2002, 2001 and 2000,
respectively.

(7)   COMMON AND PREFERRED STOCK
(b)   Preferred Stock - The carrying value of WP&L's cumulative preferred
stock at both Dec. 31, 2002 and 2001 was $60 million.  The fair market value,
based upon the market yield of similar securities and quoted market prices,
at Dec. 31, 2002 and 2001 was $48 million and $49 million, respectively.

                                      119
<PAGE>

(8)   DEBT
(a)   Short-Term Debt - Information regarding WP&L's short-term debt was as
follows (dollars in millions):

<TABLE>
<CAPTION>

                                                    2002              2001
                                                --------------    --------------
<S>                                                 <C>                <C>
At Dec. 31:
   Commercial paper outstanding                     $60.0              $--
   Discount rates on commercial paper               1.6%               N/A
   Money pool borrowings                             $--              $90.8
   Interest rates on money pool borrowings           N/A              2.4%

For the year ended:
   Average amount of short-term debt
      (based on daily outstanding balances)         $57.4             $23.8
   Average interest rates on short-term debt        1.8%              3.7%

</TABLE>

(b)  Long-Term Debt - WP&L's debt maturities for 2003 to 2007 are $0, $62.0
million, $88.0 million, $0, and $105.0 million, respectively.  The carrying
value of WP&L's long-term debt (including variable rate demand bonds) at both
Dec. 31, 2002 and 2001 was $523 million.  The fair market value, based upon
the market yield of similar securities and quoted market prices, at Dec. 31,
2002 and 2001 was $574 million and $548 million, respectively.

(9)  INVESTMENTS AND ESTIMATED FAIR VALUE OF FINANCIAL INSTRUMENTS
Information relating to various investments held by WP&L at Dec. 31 that are
marked-to-market as a result of SFAS 115 was as follows (in
millions):

<TABLE>
<CAPTION>
                                                      2002                          2001
                                           ---------------------------    --------------------------
                                             Carrying/   Unrealized        Carrying/    Unrealized
                                               Fair         Gains,           Fair         Gains,
                                               Value      Net of Tax         Value       Net of Tax
                                           ------------ --------------    ------------ -------------
<S>                                               <C>            <C>             <C>           <C>
Available-for-sale securities:
  Nuclear decommissioning trust funds:
     Debt securities                              $131           $5              $122          $2
     Equity securities                              93            5                94          23
                                           ------------ --------------    ------------ -------------
        Total                                     $224          $10              $216         $25
                                           ============ ==============    ============ =============

</TABLE>

Nuclear Decommissioning Trust Funds - At Dec. 31, 2002, $75 million, $24
million and $32 million of the debt securities mature in 2003-2010, 2011-2020
and 2021-2049, respectively.  The funds realized gains from the sales of
securities of $10.3 million, $2.1 million and $5.2 million in 2002, 2001 and
2000, respectively (cost of the investments based on specific identification
was $92.2 million, $147.4 million and $202.1 million and proceeds from the
sales were $102.5 million, $149.5 million and $207.3 million, respectively).

Unconsolidated Equity Investments - Summary financial information from WP&L's
unconsolidated equity investments' financial statements is as follows (in
millions):

                                2002         2001        2000
                              ----------  -----------  ----------
  Operating revenues            $211.7       $180.3       $5.3
  Operating income                75.7         65.8        1.3
  Net income                      59.5         55.9        1.6
As of Dec. 31:
  Current assets                  44.7         59.5
  Non-current assets             774.4        681.4
  Current liabilities             50.8         39.3
  Non-current liabilities          7.5          4.4

                                      120
<PAGE>

(11)  COMMITMENTS AND CONTINGENCIES
(a)  Construction and Acquisition Expenditures - Certain commitments have been
made in connection with 2003 capital expenditures.  During 2003, total
construction and acquisition expenditures are estimated to be approximately
$160 million.

(b)  Purchased-Power, Coal and Natural Gas Contracts - Based on the System
Coordination and Operating Agreement, Alliant Energy annually allocates
purchased-power contracts to IP&L and WP&L.  Such process considers factors
such as resource mix, load growth and resource availability.  However, for
2003, system-wide purchased-power contracts of $45.1 million (1.6 million
MWh) have not yet been directly assigned to IP&L and WP&L since the specific
needs of each utility is not yet known.  Refer to Note 18 for additional
information.  Coal contract quantities are directly assigned to specific
plants at IP&L and WP&L based on various factors including projected heat
input requirements, combustion compatibility and efficiency.  However, for
2003-2006, system-wide coal contracts of $56.1 million (7.8 million tons),
$37.5 million (7.6 million tons), $28.0 million (4.7 million tons) and $8.2
million (0.9 million tons), respectively, have not yet been directly assigned
to IP&L and WP&L since the specific needs of each utility is not yet known.
At Dec. 31, 2002, WP&L's minimum commitments were as follows (dollars and
Dths in millions; MWhs and tons in thousands):

<TABLE>
<CAPTION>
                   Purchased-power                   Coal                    Natural gas
                -----------------------     -----------------------    -------------------------
                Dollars        MWhs         Dollars        Tons         Dollars         Dths
                ---------    ----------     ---------    ----------    -----------    ----------
<S>                <C>          <C>            <C>                        <C>              <C>
2003               $31.3        219            $6.9          --           $48.1            2
2004                 8.0        219             6.9          --            32.3           --
2005                --           --             1.3          --            25.0           --
2006                --           --             1.3          --            14.1           --
2007                --           --             1.3          --            13.3           --
Thereafter          --           --            --            --            26.4           --

</TABLE>

(e)  Environmental Liabilities - WP&L had recorded the following
environmental liabilities, and regulatory assets associated with certain of
these liabilities, at Dec. 31 (in millions):

<TABLE>
<CAPTION>
                                Environmental Liabilities           Regulatory Assets
                               ----------------------------    ----------------------------
                                  2002            2001            2002            2001
                               ------------   -------------    ------------    ------------
   <S>                               <C>          <C>               <C>            <C>
   MGP sites                         $6.9         $4.4              $13.0          $11.7
   NEPA                               2.5          3.1                3.1            4.0
   Other                              --          --                  2.9            3.0
                               ------------   -------------    ------------    ------------
                                     $9.4         $7.5              $19.0          $18.7
                               ============   =============    ============    ============
</TABLE>

MGP Sites - Management currently estimates the range of remaining costs to be
---------
incurred for the investigation, remediation and monitoring of all WP&L's
sites to be approximately $6 million to $7 million.

(13)  SEGMENTS OF BUSINESS
WP&L is a regulated domestic utility, serving customers in Wisconsin and
Illinois, and includes three segments: a) electric operations; b) gas
operations; and c) other, which includes the water business and the
unallocated portions of the utility business.  Various line items in the
following tables are not allocated to the electric and gas segments for
management reporting purposes and therefore are included in "Total."  In 2002
and 2001, gas revenues included $22 million and $21 million, respectively,
for sales to the electric segment.  All other intersegment revenues were not
material to WP&L's operations and there was no single customer whose revenues
were 10% or more of WP&L's consolidated revenues.  Certain financial
information relating to WP&L's significant business segments was as follows
(in millions):

                                      121
<PAGE>

<TABLE>
<CAPTION>
                                                                   Electric          Gas            Other          Total
------------------------------------------------------------------------------------------------------------------------------
<S>                                                                    <C>            <C>              <C>              <C>
2002
----
Operating revenues                                                    $787.7         $179.1           $5.3             $972.1
Depreciation and amortization                                          117.3           17.7            1.2              136.2
Operating income                                                       114.1           12.0            1.4              127.5
Interest expense, net of AFUDC                                                                                           37.6
Interest income                                                                                                         (21.6)
Equity income from unconsolidated investments                                                                           (17.0)
Miscellaneous, net                                                                                                        2.9
Income tax expense                                                                                                       44.7
Net income                                                                                                               80.9
Preferred dividends                                                                                                       3.3
Earnings available for common stock                                                                                      77.6
Total assets                                                         1,426.7          259.5          298.4            1,984.6
Investments in equity method subsidiaries                              121.7                                            121.7
Construction and acquisition expenditures                              144.6           10.6            1.7              156.9

------------------------------------------------------------------------------------------------------------------------------

2001
----
Operating revenues                                                    $753.5         $206.9           $5.0             $965.4
Depreciation and amortization                                          111.5           16.4            1.2              129.1
Operating income                                                       121.6            2.5            1.3              125.4
Interest expense, net of AFUDC                                                                                           38.7
Interest income                                                                                                          (8.1)
Equity income from unconsolidated investments                                                                           (15.5)
Miscellaneous, net                                                                                                       (4.4)
Income tax expense                                                                                                       41.2
Net income                                                                                                               73.5
Preferred dividends                                                                                                       3.3
Earnings available for common stock                                                                                      70.2
Total assets                                                         1,323.9          224.5          327.4            1,875.8
Investments in equity method subsidiaries                              117.3                                            117.3
Construction and acquisition expenditures                              127.9           16.8            2.3              147.0

------------------------------------------------------------------------------------------------------------------------------

2000
----
Operating revenues                                                    $692.2         $165.2           $5.0             $862.4
Depreciation and amortization                                          122.9           15.9            1.1              139.9
Operating income                                                       123.2           12.2            1.7              137.1
Interest expense, net of AFUDC                                                                                           39.3
Interest income                                                                                                         (13.1)
Equity income from unconsolidated investments                                                                            (0.5)
Miscellaneous, net                                                                                                       (2.9)
Income tax expense                                                                                                       42.9
Net income                                                                                                               71.4
Preferred dividends                                                                                                       3.3
Earnings available for common stock                                                                                      68.1
Total assets                                                         1,344.9          226.1          286.0            1,857.0
Investments in equity method subsidiaries                                4.8                                              4.8
Construction and acquisition expenditures                              114.2           15.1            2.3              131.6

</TABLE>

                                      122
<PAGE>

(15)  SELECTED CONSOLIDATED QUARTERLY FINANCIAL DATA (UNAUDITED)
Summation of the individual quarters may not equal annual totals due to
rounding.

<TABLE>
<CAPTION>
                                                       2002                                      2001
                                      ----------------------------------------  ---------------------------------------
                                       March 31   June 30   Sept. 30  Dec. 31    March 31   June 30 Sept. 30   Dec. 31
                                      ---------- --------- --------- ---------  ---------- --------- -------- ---------
                                                                       (in millions)
  <S>                                      <C>       <C>       <C>       <C>         <C>       <C>       <C>      <C>
  Operating revenues                     $229.5    $217.5    $249.0    $276.1      $317.2    $204.1    $228.3   $215.8
  Operating income                         24.1      28.6      35.4      39.3        37.0      23.4      36.2     28.8
  Net income                               15.7      12.8      19.2      33.2        19.3      11.6      19.9     22.8
  Earnings available for common stock      14.9      12.0      18.3      32.4        18.4      10.7      19.0     22.0

</TABLE>

(18)    RELATED PARTIES
IP&L and WP&L have entered into a System Coordination and Operating
Agreement.  The agreement, which has been approved by FERC, provides a
contractual basis for coordinated planning, construction, operation and
maintenance of the interconnected electric generation and transmission
systems of IP&L and WP&L.  In addition, the agreement allows the
interconnected system to be operated as a single entity with off-system
capacity sales and purchases made to market excess system capability or to
meet system capability deficiencies.  Such sales and purchases are allocated
among IP&L and WP&L based on procedures included in the agreement.  The sales
amounts allocated to WP&L were $26.9 million, $32.1 million and $28.6 million
for 2002, 2001 and 2000, respectively.  The purchases allocated to WP&L were
$205.8 million, $209.2 million and $130.7 million for 2002, 2001 and 2000,
respectively.  The procedures were approved by both FERC and all state
regulatory bodies having jurisdiction over these sales.  Under the agreement,
IP&L and WP&L are fully reimbursed for any generation expense incurred to
support the sale to an affiliate or to a non-affiliate.  Any margins on sales
to non-affiliates are distributed to IP&L and WP&L in proportion to each
utility's share of electric production at the time of the sale.

Pursuant to a service agreement approved by the SEC under PUHCA, WP&L
receives various administrative and general services from an affiliate,
Corporate Services.  These services are billed to WP&L at cost based on
payroll and other expenses incurred by Corporate Services for the benefit of
WP&L.  These costs totaled $117.7 million, $107.0 million and $103.4 million
for 2002, 2001 and 2000, respectively, and consisted primarily of employee
compensation, benefits and fees associated with various professional
services.  At Dec. 31, 2002 and 2001, WP&L had a net intercompany payable to
Corporate Services of $31.1 million and $32.2 million, respectively.

                                      123
<PAGE>

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

None.

                                   PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANTS

ALLIANT ENERGY
The information required by Item 10 relating to directors and nominees for
election of directors at the 2003 Annual Meeting of Shareowners is
incorporated herein by reference to the relevant information under the
caption "Election of Directors" in Alliant Energy's Proxy Statement for the
2003 Annual Meeting of Shareowners (the 2003 Alliant Energy Proxy Statement),
which will be filed with the SEC within 120 days after the end of Alliant
Energy's fiscal year.  The information required by Item 10 relating to the
timely filing of reports under Section 16 of the Securities Exchange Act of
1934 is incorporated herein by reference to the relevant information under
the caption "Section 16(a) Beneficial Ownership Reporting Compliance" in the
2003 Alliant Energy Proxy Statement.  Information regarding executive
officers of Alliant Energy may be found in Part I of this report under the
caption "Executive Officers of the Registrants."

IP&L
IP&L's directors are identical to those of Alliant Energy.  The information
required by Item 10 relating to directors and nominees for election of
directors at the 2003 Annual Meeting of Shareowners is incorporated herein by
reference to the relevant information included under the caption "Election of
Directors" in the 2003 Alliant Energy Proxy Statement, which will be filed
with the SEC within 120 days after the end of IP&L's fiscal year.  The
information required by Item 10 relating to the timely filing of reports
under Section 16 of the Securities Exchange Act of 1934 is incorporated
herein by reference to the relevant information under the caption "Section
16(a) Beneficial Ownership Reporting Compliance" in the 2003 Alliant Energy
Proxy Statement.  Information regarding executive officers of IP&L may be
found in Part I of this report under the caption "Executive Officers of the
Registrants."

WP&L
The information required by Item 10 relating to directors and nominees for
election of directors at the 2003 Annual Meeting of Shareowners is
incorporated herein by reference to the relevant information under the
caption "Election of Directors" in WP&L's Proxy Statement for the 2003 Annual
Meeting of Shareowners (the 2003 WP&L Proxy Statement), which will be filed
with the SEC within 120 days after the end of WP&L's fiscal year.  The
information required by Item 10 relating to the timely filing of reports
under Section 16 of the Securities Exchange Act of 1934 is incorporated
herein by reference to the relevant information under the caption "Section
16(a) Beneficial Ownership Reporting Compliance" in the 2003 WP&L Proxy
Statement.  Information regarding executive officers of WP&L may be found in
Part I of this report under the caption "Executive Officers of the
Registrants."

ITEM 11.  EXECUTIVE COMPENSATION

ALLIANT ENERGY
The information required by Item 11 is incorporated herein by reference to
the relevant information under the captions "Compensation of Directors,"
"Compensation of Executive Officers," "Stock Options," "Long-Term Incentive
Awards," "Certain Agreements" and "Retirement and Employee Benefit Plans" in
the 2003 Alliant Energy Proxy Statement, which will be filed with the SEC
within 120 days after the end of Alliant Energy's fiscal year.

IP&L
The directors as well as the CEO and the four other most highly compensated
executive officers for IP&L are the same as for WP&L.  Therefore, the
information required by Item 11 is incorporated herein by reference to the
relevant information under the captions "Compensation of Directors,"
"Compensation of Executive Officers," "Stock Options," "Long-Term Incentive
Awards," "Certain Agreements" and "Retirement and Employee Benefit Plans" in
the 2003 WP&L Proxy Statement, which will be filed with the SEC within 120
days after the end of IP&L's fiscal year.

                                      124
<PAGE>

WP&L
The information required by Item 11 is incorporated herein by reference to
the relevant information under the captions "Compensation of Directors,"
"Compensation of Executive Officers," "Stock Options," "Long-Term Incentive
Awards," "Certain Agreements" and "Retirement and Employee Benefit Plans" in
the 2003 WP&L Proxy Statement, which will be filed with the SEC within 120
days after the end of WP&L's fiscal year.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

ALLIANT ENERGY
Information regarding Alliant Energy's equity compensation plans as of Dec.
31, 2002 was as follows:

<TABLE>
<CAPTION>
                                                                                                     (c)
                                                (a)                      (b)                 Number of securities
                                       Number of securities       Weighted-average         remaining available for
                                         to be issued upon        exercise price of         future issuance under
                                            exercise of              outstanding          equity compensation plans
                                       outstanding options,       options, warrants         (excluding securities
          Plan Category                 warrants and rights          and rights            reflected in column (a))
-----------------------------------    ----------------------    --------------------    -----------------------------
<S>                                            <C>                        <C>                         <C>
Equity compensation plans
  approved by shareowners                  4,325,172 (1)               $29.44                     3,226,517 (2)
Equity compensation plans not
  approved by shareowners                        N/A (3)                  N/A                           N/A (4)
                                       ----------------------    --------------------    -----------------------------
      Total                                4,325,172                   $29.44                     3,226,517
                                       ======================    ====================    =============================
</TABLE>

(1)  Represents performance shares and options to purchase shares of Alliant
     Energy common stock granted under the Alliant Energy LTEIP and EIP.  The
     performance shares are paid out in shares of Alliant Energy common
     stock or a combination of cash and stock and are modified by a performance
     multiplier, which ranges from zero to two, based on the performance
     criteria.  The performance shares included in column (a) of the table
     reflect an assumed payout at a performance multiplier of two.

(2)  All of the available shares under the LTEIP and EIP may be issued upon
     the exercise of stock options or may be issued as awards in the form of
     stock appreciation rights, restricted stock, restricted stock units,
     performance shares or performance units.  Excludes 1,745 shares of
     restricted common stock previously issued and outstanding for which the
     restrictions have not lapsed.
(3)  As of Dec. 31, 2002, there have been 239,467 shares of Alliant Energy
     common stock issued under the Alliant Energy Key Employee Deferred
     Compensation Plan (KEDCP) and the Alliant Energy Deferred Compensation Plan
     for Directors (DDCP) described below.
(4)  There is no limit on the number of shares of Alliant Energy common stock
     that may be issued under the KEDCP and the DDCP.

Deferred Compensation Plans - Alliant Energy maintains an unfunded KEDCP
under which participants may defer up to 100% of base salary, incentive
compensation and eligible supplemental executive retirement plan payments.
Participants who have made the maximum allowed contribution to the Alliant
Energy 401(k) Savings Plan may receive an additional credit to the deferred
compensation plan.  Alliant Energy also maintains an unfunded DDCP under
which directors may elect to defer all or part of their retainer fee.  Key
employees and directors may elect to have their deferrals credited to an
interest account or a company stock account, which are held in grantor
trusts.  Payments from the company stock account will be made in shares of
Alliant Energy common stock.

The remainder of the information required by Item 12 is incorporated herein
by reference to the relevant information under the caption "Ownership of
Voting Securities" in the 2003 Alliant Energy Proxy Statement, which will be
filed with the SEC within 120 days after the end of Alliant Energy's fiscal
year.

IP&L
To IP&L's knowledge, no shareowner beneficially owned 5% or more of IP&L's
8.375% Cumulative Preferred Stock as of Dec. 31, 2002.  None of the directors
or executive officers of IP&L own any shares of IP&L's 8.375% Cumulative
Preferred Stock.

                                      125
<PAGE>

WP&L
The information required by Item 12 is incorporated herein by reference to
the relevant information under the caption "Ownership of Voting Securities"
in the 2003 WP&L Proxy Statement, which will be filed with the SEC within 120
days after the end of WP&L's fiscal year.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

None.

ITEM 14.  CONTROLS AND PROCEDURES

Within 90 days prior to the date of filing this Annual Report on Form 10-K,
Alliant Energy, IP&L and WP&L carried out evaluations, under the supervision
and with the participation of their management, including their CEO, CFO and
Disclosure Committee, of the effectiveness of the design and operation of
Alliant Energy's, IP&L's and WP&L's disclosure controls and procedures
pursuant to the requirements of the Securities Exchange Act of 1934, as
amended.  Based on those evaluations, the CEO and the CFO concluded that
Alliant Energy's, IP&L's and WP&L's disclosure controls and procedures were
effective as of the date of such evaluation.

There have been no significant changes in Alliant Energy's, IP&L's and WP&L's
internal controls, or in other factors that could significantly affect
internal controls, subsequent to the date of their evaluation, including any
corrective actions with regard to significant deficiencies and material
weaknesses.

                                    PART IV

ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a) (1) Consolidated Financial Statements - Refer to "Index to Financial
        ---------------------------------
        Statements" in Item 8 Financial Statements and Supplementary Data.

(a) (2) Financial Statement Schedules - Schedule II.  Valuation and Qualifying
        -----------------------------
        Accounts and Reserves

   NOTE: All other schedules are omitted because they are not applicable or
   not required, or because that required information is shown either in the
   consolidated financial statements or in the notes thereto.

(a) (3) Exhibits Required by Securities and Exchange Commission
        -------------------------------------------------------
Regulation S-K - The following Exhibits are filed herewith or incorporated
--------------
herein by reference.

  2.1     Agreement and Plan of Merger, dated as of March 15, 2000, as
          amended on Nov. 29, 2000, between IP&L (formerly IESU) and
          IPC (incorporated by reference to Appendix A to the joint
          proxy statement/prospectus of IP&L, dated Feb. 13, 2001
          (Registration No. 333-53846))

  3.1     Restated Articles of Incorporation of Alliant Energy, as
          amended (incorporated by reference to Exhibit 3.2 to Alliant
          Energy's Form 10-Q for the quarter ended June 30, 1999)


  3.2     Bylaws of Alliant Energy, as amended, effective as of Jan.
          30, 2001 (incorporated by reference to Exhibit 3.2 to
          Alliant Energy's Form 10-K for the year 2000)

  3.3     Restated Articles of Incorporation of WP&L, as amended
          (incorporated by reference to Exhibit 3.1 to WP&L's Form
          10-Q for the quarter ended June 30, 1994)

  3.4     Bylaws of WP&L, as amended, effective as of Jan. 30, 2001
          (incorporated by reference to Exhibit 3.4 to WP&L's Form
          10-K for the year 2000)

  3.5     Restated Articles of Incorporation of IP&L (incorporated by
          reference to Exhibit 3.1 to IP&L's Form 10-Q for the quarter
          ended Sept. 30, 2002)

  3.5a    Articles of Amendment to IP&L's Restated Articles of
          Incorporation

                                      126
<PAGE>
  3.6     Bylaws of IP&L, as amended, effective as of Jan. 30, 2001
          (incorporated by reference to Exhibit 3.6 to IP&L's Form
          10-K for the year 2000)

  4.1     Rights Agreement, dated Jan. 20, 1999, between Alliant
          Energy and Wells Fargo Bank Minnesota, N.A., successor
          (incorporated by reference to Exhibit
          4.1 to Alliant Energy's Registration Statement on Form 8-A,
          dated Jan. 20, 1999)

  4.2     Indenture of Mortgage or Deed of Trust dated Aug. 1, 1941,
          between WP&L and U.S. Bank National Association (U.S. Bank)
          and Robert T. Jones, successor, as Trustees, filed as
          Exhibit 7(a) in File No. 2-6409, and the indentures
          supplemental thereto dated, respectively, Jan. 1, 1948,
          Sept. 1, 1948, June 1, 1950, April 1, 1951, April 1, 1952,
          Sept. 1, 1953, Oct. 1, 1954, March 1, 1959, May 1, 1962,
          Aug. 1, 1968, June 1, 1969, Oct. 1, 1970, July 1, 1971,
          April 1, 1974, Dec. 1, 1975, May 1, 1976, May 15, 1978,
          Aug. 1, 1980, Jan. 15, 1981, Aug. 1, 1984, Jan. 15, 1986,
          June 1, 1986, Aug. 1, 1988, Dec. 1, 1990, Sept. 1, 1991,
          Oct. 1, 1991, March 1, 1992, May 1, 1992, June 1, 1992 and
          July 1, 1992 (Second Amended Exhibit 7(b) in File
          No. 2-7361; Amended Exhibit 7(c) in File No. 2-7628; Amended
          Exhibit 7.02 in File No. 2-8462; Amended Exhibit 7.02 in
          File No. 2-8882; Second Amendment Exhibit 4.03 in File
          No. 2-9526; Amended Exhibit 4.03 in File No. 2-10406;
          Amended Exhibit 2.02 in File No. 2-11130; Amended
          Exhibit 2.02 in File No. 2-14816; Amended Exhibit 2.02 in
          File No. 2-20372; Amended Exhibit 2.02 in File No. 2-29738;
          Amended Exhibit 2.02 in File No. 2-32947; Amended
          Exhibit 2.02 in File No. 2-38304; Amended Exhibit 2.02 in
          File No. 2-40802; Amended Exhibit 2.02 in File No. 2-50308;
          Exhibit 2.01(a) in File No. 2-57775; Amended Exhibit 2.02 in
          File No. 2-56036; Amended Exhibit 2.02 in File No. 2-61439;
          Exhibit 4.02 in File No. 2-70534; Amended Exhibit 4.03 in
          File No. 2-70534; Exhibit 4.02 in File No. 33-2579; Amended
          Exhibit 4.03 in File No. 33-2579; Amended Exhibit 4.02 in
          File No. 33-4961; Exhibit 4.24 in File No. 33-45726, Exhibit
          4.25 in File No. 33-45726, Exhibit 4.26 in File
          No. 33-45726, Exhibit 4.27 in File No. 33-45726, Exhibit 4.1
          to WP&L's Form 8-K dated March 9, 1992, Exhibit 4.1 to
          WP&L's Form 8-K dated May 12, 1992, Exhibit 4.1 to WP&L's
          Form 8-K dated June 29, 1992 and Exhibit 4.1 to WP&L's
          Form 8-K dated July 20, 1992)

  4.3     Indenture, dated as of June 20, 1997, between WP&L and U.S.
          Bank, as Trustee, relating to debt securities (incorporated
          by reference to Exhibit 4.33 to Amendment No. 2 to WP&L's
          Registration Statement on Form S-3 (Registration No.
          33-60917))

  4.4     Officers' Certificate, dated as of June 25, 1997, creating
          WP&L's 7% debentures due June 15, 2007 (incorporated by
          reference to Exhibit 4 to WP&L's Form 8-K, dated June 25,
          1997)

  4.5     Officers' Certificate, dated as of Oct. 27, 1998, creating
          WP&L's 5.7% debentures due Oct. 15, 2008 (incorporated by
          reference to Exhibit 4 to WP&L's Form 8-K, dated Oct. 27,
          1998)

  4.6     Officers' Certificate, dated as of March 1, 2000, creating
          WP&L's 7-5/8% debentures due March 1, 2010 (incorporated by
          reference to Exhibit 4 to WP&L's Form 8-K, dated March 1,
          2000)

  4.7     Indenture of Mortgage and Deed of Trust, dated as of
          Sept. 1, 1993, between IP&L and Bank One Trust Company,
          National Association (Bank One Trust), successor, as Trustee
          (incorporated by reference to Exhibit 4(c) to
          IP&L's Form 10-Q for the quarter ended Sept. 30, 1993), and
          the indentures supplemental thereto dated, respectively,
          Oct. 1, 1993, Nov. 1, 1993, March 1, 1995, Sept. 1, 1996 and
          April 1, 1997 (Exhibit 4(d) in IP&L's Form 10-Q dated Nov.
          12, 1993, Exhibit 4(e) in IP&L's Form 10-Q dated Nov. 12,
          1993, Exhibit 4(b) in IP&L's Form 10-Q dated May 12, 1995,
          Exhibit 4(c)(i) in IP&L's Form 8-K dated Sept. 19, 1996 and
          Exhibit 4(a) in IP&L's Form 10-Q dated May 14, 1997)

  4.8     Indenture or Deed of Trust dated as of Feb. 1, 1923, between
          IP&L and Bank One Trust, successor and Lawrence Dillard,
          successor, as Trustees (incorporated by
          reference to Exhibit B-1 to File No. 2-1719), and the
          indentures supplemental thereto dated, respectively, May 1,
          1940, May 2, 1940, Oct. 1, 1945, Oct. 2, 1945, Jan. 1, 1948,
          Sept. 1, 1950, Feb. 1, 1953, Oct. 2, 1953, Aug. 1, 1957,
          Sept. 1, 1962, June 1, 1967, Feb. 1, 1973, Feb. 1, 1975,
          July 1, 1975, Sept. 2, 1975, March 10, 1976, Feb. 1, 1977,
          Jan. 1, 1978, March 1, 1979, March 1, 1980, May 31, 1986,
          July 1, 1991, Sept. 1, 1992 and Dec. 1, 1994 (Exhibit B-1-k
          in File No. 2-4921, Exhibit B-1-l in File No. 2-4921,
          Exhibit 7(m) in File No. 2-8053, Exhibit 7(n) in File No.
          2-8053, Exhibit 7(o) in File No. 2-8053, Exhibit 4(e) in
                                      127
<PAGE>
          File No. 33-3995, Exhibit 4(b) in File No. 2-10543, Exhibit
          4(q) in File No. 2-10543, Exhibit 2(b) in File No. 2-13496,
          Exhibit 2(b) in File No. 2-20667, Exhibit 2(b) in File No.
          2-26478, Exhibit 2(b) in File No. 2-46530, Exhibit 2(aa) in
          File No. 2-53860, Exhibit 2(bb) in File No. 2-54285, Exhibit
          2(bb) in File No. 2-57510, Exhibit 2(cc) in File No.
          2-57510, Exhibit 2(ee) in File No. 2-60276, Exhibit 2 in
          File No. 0-849, Exhibit 2 in File No. 0-849, Exhibit 2 in
          File No. 0-849, Exhibit 4(g) in File No. 33-3995, Exhibit
          4(h) in File No. 0-849, Exhibit 4(m) in File No. 0-849 and
          Exhibit 4(f) in File No. 0-4117-1)

  4.9     Indenture (For Unsecured Subordinated Debt Securities),
          dated as of Dec. 1, 1995, between IP&L and Bank One Trust,
          successor, as Trustee (incorporated
          by reference to Exhibit 4(i) to IP&L's Amendment No. 1 to
          Registration Statement, File No. 33-62259)

  4.10    Indenture (For Senior Unsecured Debt Securities), dated as
          of Aug. 1, 1997, between IP&L and Bank One Trust, successor,
          as Trustee (incorporated by reference to Exhibit 4(j) to
          IP&L's Registration Statement, File No. 333-32097)

  4.11    Officer's Certificate, dated as of Aug. 4, 1997, creating
          IP&L's 6-5/8% Senior Debentures, Series A, due 2009
          (incorporated by reference to Exhibit 4.12 to IP&L's Form
          10-K for the year 2000)

  4.12    Officers' Certificate, dated as of March 6, 2001, creating
          IP&L's 6-3/4% Series B Senior Debentures due 2011
          (incorporated by reference to Exhibit 4 to IP&L's Form 8-K,
          dated March 6, 2001)

  4.13    The Original through the Nineteenth Supplemental Indentures
          of IP&L, successor, to JPMorgan Chase Bank and James P. Freeman,
          successor, as Trustee, dated Jan. 1, 1948 securing First
          Mortgage Bonds (incorporated by reference to Exhibits 4(b)
          through 4(t) to IPC's Registration Statement No. 33-59352
          dated March 11, 1993)

  4.14    Twentieth Supplemental Indenture of IP&L, successor, to JPMorgan Chase
          Bank and James P. Freeman, successor, as Trustees, dated May
          15, 1993 (incorporated by reference to Exhibit 4(u) to IPC's
          Registration Statement No. 33-59352 dated March 11, 1993)

  4.15    Twenty-First Supplemental Indenture of IP&L, successor, to JPMorgan
          Chase Bank and James P. Freeman, as Trustees, dated Dec. 31,
          2001 (incorporated by reference to Exhibit 4.3 to IP&L's
          Form 8-K, dated Jan. 1, 2002)

  4.16    Indenture, dated as of Nov. 4, 1999, among Resources, Alliant Energy,
          as Guarantor, and U.S. Bank, as Trustee (incorporated by
          reference to Exhibit 4.1 to Resources' and Alliant Energy's
          Registration Statement on Form S-4 (Registration No.
          333-92859)), and the indentures supplemental thereto dated,
          respectively, Nov. 4, 1999, Feb. 1, 2000 and Nov. 15, 2001
          (Exhibit 4.2 in Registration No. 333-92859, Exhibit 99.4 in
          Alliant Energy's Form 8-K dated Feb. 1, 2000 and Exhibit 4.4
          in Resources' and Alliant Energy's Registration Statement on
          Form S-4 (Registration No. 333-75020))

  4.16a   Fourth Supplemental Indenture, dated as of Dec. 26, 2002,
          among Resources, Alliant Energy, as Guarantor, and U.S.
          Bank, as Trustee

  4.17    Registration Rights Agreement, dated as of Dec. 26, 2002,
          among Resources, Alliant Energy, Merrill Lynch, Pierce,
          Fenner & Smith Inc., Utehdahl Capital Partners, L.P. and The
          Williams Capital Group, L.P.

  4.18    Registration Rights Agreement, dated as of Dec. 20, 2002,
          between IP&L and Robert W. Baird & Co. Inc.


  10.1    364-Day Credit Agreement, dated as of Oct. 11, 2002, among
          Alliant Energy, the Banks named therein and Bank One, NA, as
          administrative agent and issuer of Letters of Credit
          (incorporated by reference to Exhibit 10.1 to Alliant
          Energy's Form 10-Q for the quarter ended Sept. 30, 2002)

  10.2    Credit Agreement, dated as of Oct. 11, 2002, among IP&L, the
          Banks named therein and Citibank, N.A., as administrative
          agent (incorporated by reference to Exhibit 10.2 to IP&L's
          10-Q for the quarter ended Sept. 30, 2002)

  10.3    Credit Agreement, dated as of Oct. 11, 2002, among WP&L, the
          Banks named therein and Citibank, N.A., as administrative
          agent (incorporated by reference to Exhibit 10.3 to WP&L's
          10-Q for the quarter ended Sept. 30, 2002)
                                      128
<PAGE>
  10.4    364-Day Credit Agreement, dated as of Dec. 27, 2002, among
          Resources, as Borrower, and Alliant Energy, Heartland
          Properties, Inc. and International, as Guarantors and the
          Lenders Named therein and Merrill Lynch Capital Corporation, as
          Administrative Agent

  10.5    Credit Agreement, dated as of Dec. 20, 2002, among Whiting,
          as Borrower, the Financial Institutions Listed on Schedule
          1.1 thereto, as Banks, Bank One, NA, as Administrative
          Agent, and Wachovia Bank, National Association, as
          Syndication Agent

  10.5a   First Amendment to Credit Agreement, dated as of Jan. 7,
          2003, by and among Whiting, Bank One, NA, as Administrative
          Agent and each of the Financial Institutions a Party thereto

  10.6    Service Agreement by and among WP&L, South Beloit, IP&L and
          Corporate Services (incorporated by reference to Exhibit
          10.1 to Alliant Energy's Form 10-Q for the quarter ended
          June 30, 1998)

  10.7    Service Agreement by and among Resources, IPC Development
          Company, Inc. and Corporate Services (incorporated by
          reference to Exhibit 10.2 to Alliant Energy's Form 10-Q for
          the quarter ended June 30, 1998)

  10.8    System Coordination and Operating Agreement dated April 11,
          1997, among IP&L, WP&L and Corporate Services (incorporated
          by reference to Exhibit 10.3 to Alliant Energy's Form 10-Q
          for the quarter ended June 30, 1998)

  10.9    Joint Power Supply Agreement among WPSC, WP&L, and MG&E,
          dated Feb. 2, 1967 (incorporated by reference to Exhibit
          4.09 of WPSC in File No. 2-27308)

  10.9a   Amendment No. 1 to Joint Power Supply Agreement dated Feb.
          2, 1967 among WPSC, WP&L, and MG&E (incorporated by
          reference to Exhibit 10.1 to WP&L's Form 10-Q for the
          quarter ended Sept. 30, 2001)

  10.10   Joint Power Supply Agreement among WPSC, WP&L, and MG&E,
          dated July 26, 1973 (incorporated by reference to Exhibit
          5.04A of WPSC in File No. 2-48781)

  10.11   Basic Generating Agreement, Unit 4, Edgewater Generating
          Station, dated June 5, 1967, between WP&L and WPSC
          (incorporated by reference to Exhibit 4.10 of WPSC in File
          No. 2-27308)

  10.12   Agreement for Construction and Operation of Edgewater 5
          Generating Unit, dated Feb. 24, 1983, between WP&L, WEPCO
          and WPSC (incorporated by reference to Exhibit 10C-1 to
          WPSC's Form 10-K for the year 1983 (File No. 1-3016))

  10.12a  Amendment No. 1 to Agreement for Construction and Operation
          of Edgewater 5 Generating Unit, dated Dec. 1, 1988
          (incorporated by reference to Exhibit 10C-2 to WPSC's Form
          10-K for the year 1988 (File No. 1-3016))

  10.13   Revised Agreement for Construction and Operation of Columbia
          Generating Plant among WPSC, WP&L, and MG&E, dated July 26,
          1973 (incorporated by reference to Exhibit 5.07 of WPSC in
          File No. 2-48781)

  10.14   Operating and Transmission Agreement between CIPCO and IP&L
          (incorporated by reference to Exhibit 10(q) to IP&L's Form
          10-K for the year 1990)

  10.15   DAEC Ownership Participation Agreement dated June 1, 1970
          between CIPCO, Corn Belt Power Cooperative and IP&L
          (incorporated by reference to Exhibit 5(kk) to IP&L's
          Registration Statement, File No. 2-38674)

  10.16   DAEC Operating Agreement dated June 1, 1970 between CIPCO,
          Corn Belt Power Cooperative and IP&L (incorporated by
          reference to Exhibit 5(ll) to IP&L's Registration Statement,
          File No. 2-38674)

  10.17   DAEC Agreement for Transmission, Transformation, Switching,
          and Related Facilities dated June 1, 1970 between CIPCO,
          Corn Belt Power Cooperative and IP&L (incorporated by
          reference to Exhibit 5(mm) to IP&L's Registration Statement,
          File No. 2-38674)
                                      129
<PAGE>
  10.18   Basic Generating Agreement dated April 16, 1975 between Iowa
          Public Service Company, Iowa Power and Light Company,
          Iowa-Illinois Gas and Electric Company and IP&L for the
          joint ownership of Ottumwa Generating Station-Unit 1 (OGS-1)
          (incorporated by reference to Exhibit 1 to IP&L's Form 10-K
          for the year 1977)

  10.18a  Addendum Agreement to the Basic Generating Agreement for
          OGS-1 dated Dec. 7, 1977 between Iowa Public Service
          Company, Iowa-Illinois Gas and Electric Company, Iowa Power
          and Light Company and IP&L for the purchase of 15% ownership
          in OGS-1 (incorporated by reference to Exhibit 3 to IP&L's
          Form 10-K for the year 1977)

  10.19   Second Amended and Restated Credit Agreement dated as of
          Sept. 17, 1987 between Arnold Fuel, Inc. and Bank One Trust,
          successor, and the Amended and Restated Consent and
          Agreement dated as of Sept. 17, 1987 by IP&L (incorporated
          by reference to Exhibit 10(j) to IP&L's Form 10-K for the
          year 1987)

  10.20   Asset Contribution Agreement between ATC and WEPCO, WP&L,
          WPSC, MG&E, Edison Sault Electric Company and South Beloit,
          dated as of Dec. 15, 2000 (incorporated by reference to
          Exhibit 10.15 to Alliant Energy's Form 10-K for the year
          2000)

  10.20a  Addenda to the Asset Contribution Agreement between ATC and
          WEPCO, WP&L, WPSC, MG&E, Edison Sault Electric Company and
          South Beloit, dated as of Dec. 15, 2000 (incorporated by
          reference to Exhibit 10.15a to Alliant Energy's Form 10-K
          for the year 2000)

  10.21   Operating Agreement of ATC, dated as of Jan. 1, 2001
          (incorporated by reference to Exhibit 10.16 to Alliant
          Energy's Form 10-K for the year 2000)

  10.22#  Alliant Energy LTEIP, as amended (incorporated by reference
          to Exhibit 10.1 to Alliant Energy's Form 10-Q for the
          quarter ended June 30, 1999)

  10.23#  Alliant Energy EIP (incorporated by reference to Exhibit 4.2
          to Alliant Energy's Registration Statement on Form S-8
          (Registration No. 333-88304))

  10.24#  Alliant Energy 1998 Officer Incentive Compensation Plan
          (incorporated by reference to Exhibit 10.16 to Alliant
          Energy's Form 10-Q for the quarter ended June 30, 1998)

  10.25#  Alliant Energy KEDCP (incorporated by reference to Exhibit
          4.2 to Alliant Energy's Registration Statement on Form S-8
          dated Dec. 1, 2000)

  10.26#  KEDCP (incorporated by reference to Exhibit 10(n) to IES's
          Form 10-K for the year 1987)

  10.26a# Amendments to Key Employee Deferred Compensation Agreement
          for Key Employees (incorporated by reference to Exhibit
          10(v) to IES's Form 10-Q for the quarter ended March 31,
          1990)

  10.27#  DDCP, as amended and restated effective Jan. 1, 2000,
          amended Nov. 14, 2001 (incorporated by reference to Exhibit
          10.22 to Alliant Energy's Form 10-K for the year 2001)

  10.28#  IP&L Irrevocable Trust Agreement dated April 30, 1990
          (incorporated by reference to Exhibit 99.f to IPC's Form
          10-K for the year 1993)

  10.29#  IP&L Irrevocable Trust Agreement dated December 1997
          (incorporated by reference to Exhibit 99.7 to IPC's Form
          10-K for the year 1997)

  10.30#  Alliant Energy Grantor Trust for Deferred Compensation
          Agreements (Key Employees) (incorporated by reference to
          Exhibit 4.4 to Alliant Energy's Registration Statement on
          Form S-8 (Registration No. 33-51126))

  10.31#  Alliant Energy Grantor Trust for Deferred Compensation
          Agreements (Directors) (incorporated by reference to Exhibit
          4.3 to Alliant Energy's Registration Statement on Form S-8
          (Registration No. 33-51126))

  10.32#  Form of Supplemental Retirement Agreement (SRA)
          (incorporated by reference to Exhibit 10.15 to Alliant
          Energy's Form 10-Q for the quarter ended June 30, 1998)
                                      130
<PAGE>
  10.33#  Form of SRA (incorporated by reference to Exhibit 10.1 to
          Alliant Energy's Form 10-Q for the quarter ended June 30,
          2002)

  10.34#  Supplemental Retirement Plan (incorporated by reference to
          Exhibit 10(l) to IES's Form 10-K for the year 1987)

  10.35#  Alliant Energy Excess Plan (incorporated by reference to
          Exhibit 10.33 to Alliant Energy's Form 10-K for the year
          2000)

  10.36#  SRA by and between Alliant Energy and E.B. Davis, Jr., W.D.
          Harvey, J.E. Hoffman, E.G. Protsch, B.J. Swan, P.J. Wegner
          and T.M. Walker (incorporated by reference to Exhibit 10.1
          to Alliant Energy's Form 10-Q for the quarter ended March
          31, 2000)

  10.37#  Key Executive Employment and Severance Agreement (KEESA),
          dated March 29, 1999, by and between Alliant Energy and
          Erroll B. Davis, Jr. (incorporated by reference to Exhibit
          10.2 to Alliant Energy's Form 10-Q for the quarter ended
          March 31, 1999)

  10.38#  KEESA, dated March 29, 1999, by and between Alliant Energy
          and each of J.E. Hoffman, W.D. Harvey, E.G. Protsch, P.J.
          Wegner, T.M. Walker and B.J. Swan (incorporated by reference
          to Exhibit 10.3 to Alliant Energy's Form 10-Q for the
          quarter ended March 31, 1999)

  10.39#  KEESA, dated March 29, 1999, by and between Alliant Energy
          and each of T.L. Aller, D.K. Doyle, D.L. Mineck, and K.K.
          Zuhlke; dated April 23, 2002, by and between Alliant Energy
          and V.A. Gebhart; dated May 22, 2002, by and between Alliant
          Energy and T.L. Hanson (incorporated by reference to Exhibit
          10.4 to Alliant Energy's Form 10-Q for the quarter ended
          March 31, 1999)

  10.40#  Employment Agreement by and between Alliant Energy and
          Erroll B. Davis, Jr., amended and restated as of March 29,
          1999 (incorporated by reference to Exhibit 10.5 to Alliant
          Energy's Form 10-Q for the quarter ended March 31, 1999)

  10.41#  Executive Tenure Compensation Plan as revised November 1992
          (incorporated by reference to Exhibit 10A to Alliant
          Energy's Form 10-K for the year 1992)

  10.41a# Amendment to Executive Tenure Compensation Plan adopted Feb.
          23, 1998 (incorporated by reference to Exhibit 10.19a to
          Alliant Energy's Form 10-Q for the quarter ended June 30,
          1998)

  21      Subsidiaries of Alliant Energy and WP&L

  23      Independent Auditors' Consent for Alliant Energy

  99.1    Written Statement of the Chairman, President and CEO
          Pursuant to 18 U.S.C. Section 1350 for Alliant Energy

  99.2    Written Statement of the EVP and CFO Pursuant to 18
          U.S.C. Section 1350 for Alliant Energy

  99.3    Written Statement of the Chairman and CEO Pursuant to 18
          U.S.C. Section 1350 for IP&L

  99.4    Written Statement of the EVP and CFO Pursuant to 18
          U.S.C. Section 1350 for IP&L

  99.5    Written Statement of the Chairman and CEO Pursuant to 18
          U.S.C. Section 1350 for WP&L

  99.6    Written Statement of the EVP and CFO Pursuant to 18
          U.S.C. Section 1350 for WP&L

Pursuant to Item 601(b)(4)(iii) of Regulation S-K, the registrants agree to
furnish to the SEC, upon request, any instrument defining the rights of
holders of unregistered long-term debt not filed as an exhibit to this
Form 10-K.  No such instrument authorizes securities in excess of 10% of the
total assets of Alliant Energy, WP&L or IP&L, as the case may be.

Documents incorporated by reference to filings made by Alliant Energy under
the Securities Exchange Act of 1934, as amended, are under File No. 1-9894.
Documents incorporated by reference to filings made by WP&L under the
Securities Exchange Act of 1934, as amended, are under File No. 0-337.
Documents incorporated by reference to filings made by IES under the
Securities Exchange Act of 1934, as amended, are under File No. 1-9187.
Documents incorporated by reference to filings made by IP&L under the
                                      131
<PAGE>
Securities Exchange Act of 1934, as amended, are under File No. 0-4117-1.
Documents incorporated by reference to filings made by IPC under the
Securities Exchange Act of 1934, as amended, are under File No. 1-3632.

# - A management contract or compensatory plan or arrangement.

(b)   Reports on Form 8-K
      -------------------

Alliant Energy
Alliant Energy filed a Current Report on Form 8-K, dated Dec. 26, 2002,
reporting (under Items 5 and 7) that it issued a press release announcing
that Resources completed a private placement of $300 million in senior notes
in accordance with Rule 144A under the Securities Act of 1933.

Alliant Energy filed a Current Report on Form 8-K, dated Dec. 20, 2002,
reporting (under Items 5 and 7) that it issued two press releases announcing
that:  1) IP&L completed a private placement of $150 million of preferred
stock in accordance with Rule 144A under the Securities Act of 1933; and 2)
Whiting closed a revolving credit facility with a current maximum borrowing
availability of $200 million which matures on Dec. 20, 2005.

Alliant Energy filed a Current Report on Form 8-K, dated Dec. 16, 2002,
reporting (under Item 5) that, among other things, it:  1) will, as early as
the fourth quarter of 2002, be required under SFAS 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets," to classify the assets of
Whiting, its investments in Australia and its affordable housing business as
held for sale and their operations as discontinued operations; 2) may also be
required to record accounting adjustments, other charges and/or income in the
fourth quarter of 2002 and/or in 2003 related to these proposed divestitures;
3) had engaged its current independent auditors, Deloitte & Touche LLP, to
reaudit its financial statements for the years ended Dec. 31, 2001 and 2000
as a result of the aforementioned reclassifications; and 4) continues to
pursue various financing transactions, the proceeds of which will be used to
repay short-term debt and for other general corporate purposes, to enhance
its liquidity position.

Alliant Energy filed a Current Report on Form 8-K, dated Nov. 22, 2002,
reporting (under Items 5 and 7) that it issued a press release announcing
that its Board of Directors approved five strategic actions designed to
maintain strong credit ratings, strengthen its balance sheet and position it
for improved long-term financial performance and providing updated 2003
earnings guidance based on these actions.

IP&L
IP&L filed a Current Report on Form 8-K, dated Dec. 20, 2002, reporting
(under Items 5 and 7) that Alliant Energy issued a press release announcing
that IP&L completed a private placement of $150 million of preferred stock in
accordance with Rule 144A under the Securities Act of 1933.

WP&L - None.

                                      132
<PAGE>

            SCHEDULE II -VALUATION AND QUALIFYING ACCOUNTS AND RESERVES

<TABLE>
<CAPTION>

                                                                         Additions
                                                             -----------------------------------
                                                Balance,       Charged to     Charged to Other                    Balance,
      Description                                Jan. 1          Expense        Accounts (1)    Deductions (2)     Dec. 31
-------------------------------------------------------------------------------------------------------------------------------
                                                                              (in thousands)
Valuation and Qualifying Accounts Which are Deducted in the Balance Sheet From the Assets to Which They Apply:
     Accumulated Provision for Uncollectible Accounts:
     -------------------------------------------------
         <S>                                        <C>             <C>              <C>               <C>             <C>
        Alliant Energy
        --------------
           Year ended Dec. 31, 2002               $9,045          $15,659          $1,244            $12,072        $13,876
           Year ended Dec. 31, 2001                4,341            9,613           2,368              7,277          9,045
           Year ended Dec. 31, 2000                3,048            3,644           1,616              3,967          4,341
        IP&L
        ----
           Year ended Dec. 31, 2002               $1,883           $3,115             $--             $3,716         $1,282
           Year ended Dec. 31, 2001                1,316            7,206              --              6,639          1,883
           Year ended Dec. 31, 2000                1,841            3,273              --              3,798          1,316
        WP&L
        ----
           Year ended Dec. 31, 2002               $1,543           $4,067          $1,244             $4,626         $2,228
           Year ended Dec. 31, 2001                    8               37           1,498                 --          1,543
           Year ended Dec. 31, 2000                    6                2              --                 --              8
Note:  The above provisions relate to various customer, notes and other receivable balances included in various
line items on the respective Consolidated Balance Sheets.

Other Reserves:
    Accumulated Provision for Injuries & Damages, Workers' Compensation, Litigation and Other Miscellaneous Reserves:
    -----------------------------------------------------------------------------------------------------------------
        Alliant Energy
        --------------
           Year ended Dec. 31, 2002               $7,596          $10,221             $--             $4,079        $13,738
           Year ended Dec. 31, 2001               12,489            3,047              --              7,940          7,596
           Year ended Dec. 31, 2000                8,963            8,505              --              4,979         12,489
        IP&L
        ----
           Year ended Dec. 31, 2002               $4,618           $4,551             $--             $1,994         $7,175
           Year ended Dec. 31, 2001                4,825            1,712              --              1,919          4,618
           Year ended Dec. 31, 2000                5,123            2,766              --              3,064          4,825
        WP&L
        ----
           Year ended Dec. 31, 2002               $2,574           $4,011             $--             $1,732         $4,853
           Year ended Dec. 31, 2001                2,689            1,266              --              1,381          2,574
           Year ended Dec. 31, 2000                2,994            1,282              --              1,587          2,689

</TABLE>

(1)  Accumulated provision for uncollectible accounts:  In 2001, Resources
     acquired SmartEnergy and assumed a provision of $0.9 million.  In 2000,
     Alliant Energy acquired EUA Cogenex Corporation and assumed a provision of
     $1.6 million.  In accordance with its regulatory treatment, certain amounts
     provided by WP&L are recorded in regulatory assets.
(2)  Deductions are of the nature for which the reserves were created.  In
     the case of the accumulated provision for uncollectible accounts,
     deductions from this reserve are reduced by recoveries of amounts
     previously written off.

                                      133
<PAGE>

                                   SIGNATURES

      Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized on the 25th day
of March 2003.

                      ALLIANT ENERGY CORPORATION

                         By: /s/ Erroll B. Davis, Jr.
                             ------------------------
                                 Erroll B. Davis, Jr.
                                 Chairman, President and Chief Executive Officer

      Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities indicated on the 25th day of March 2003.

<TABLE>
<CAPTION>
         <S>                                                               <C>

/s/ Erroll B. Davis, Jr.         Chairman, President, Chief Executive Officer and Director (Principal Executive Officer)
-----------------------------
    Erroll B. Davis, Jr.


/s/ Thomas M. Walker             Executive Vice President and Chief Financial Officer (Principal Financial Officer)
-----------------------------
    Thomas M. Walker


/s/ John E. Kratchmer            Vice President-Controller and Chief Accounting Officer (Principal Accounting Officer)
-----------------------------
    John E. Kratchmer



/s/ Alan B. Arends               Director                         /s/ David A. Perdue                 Director
-----------------------------                                     --------------------------------
    Alan B. Arends                                                    David A. Perdue


/s/ Jack B. Evans                Director                         /s/ Judith D. Pyle                  Director
-----------------------------                                     --------------------------------
    Jack B. Evans                                                     Judith D. Pyle


/s/ Joyce L. Hanes               Director                         /s/ Robert W. Schlutz               Director
-----------------------------                                     --------------------------------
    Joyce L. Hanes                                                    Robert W. Schlutz


/s/ Lee Liu                      Director                         /s/ Wayne H. Stoppelmoor            Director
-----------------------------                                     --------------------------------
    Lee Liu                                                           Wayne H. Stoppelmoor


/s/ Katharine C. Lyall           Director                         /s/ Anthony R. Weiler               Director
-----------------------------                                     --------------------------------
    Katharine C. Lyall                                                Anthony R. Weiler


/s/ Singleton B. McAllister      Director
-----------------------------
    Singleton B. McAllister

</TABLE>

                                      134
<PAGE>

                                  SIGNATURES

      Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized on the 25th day
of March 2003.

                      INTERSTATE POWER AND LIGHT COMPANY

                             By: /s/ Erroll B. Davis, Jr.
                                 ------------------------
                                     Erroll B. Davis, Jr.
                                     Chairman and Chief Executive Officer

      Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities indicated on the 25th day of March 2003.

<TABLE>
<CAPTION>
           <S>                                                         <C>
/s/ Erroll B. Davis, Jr.         Chairman, Chief Executive Officer and Director (Principal Executive Officer)
-----------------------------
    Erroll B. Davis, Jr.


/s/ Thomas M. Walker             Executive Vice President and Chief Financial Officer (Principal Financial Officer)
-----------------------------
    Thomas M. Walker


/s/ John E. Kratchmer            Vice President-Controller and Chief Accounting Officer (Principal Accounting Officer)
-----------------------------
    John E. Kratchmer



/s/ Alan B. Arends               Director                         /s/ David A. Perdue                 Director
-----------------------------                                     --------------------------------
    Alan B. Arends                                                    David A. Perdue


/s/ Jack B. Evans                Director                         /s/ Judith D. Pyle                  Director
-----------------------------                                     --------------------------------
    Jack B. Evans                                                     Judith D. Pyle


/s/ Joyce L. Hanes               Director                         /s/ Robert W. Schlutz               Director
-----------------------------                                     --------------------------------
    Joyce L. Hanes                                                    Robert W. Schlutz


/s/ Lee Liu                      Director                         /s/ Wayne H. Stoppelmoor            Director
-----------------------------                                     --------------------------------
    Lee Liu                                                           Wayne H. Stoppelmoor


/s/ Katharine C. Lyall           Director                         /s/ Anthony R. Weiler               Director
-----------------------------                                     --------------------------------
    Katharine C. Lyall                                                Anthony R. Weiler


/s/ Singleton B. McAllister      Director
-----------------------------
    Singleton B. McAllister

</TABLE>

                                      135
<PAGE>

                                  SIGNATURES

      Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized on the 25th day
of March 2003.

                       WISCONSIN POWER AND LIGHT COMPANY

                             By: /s/ Erroll B. Davis, Jr.
                                 ------------------------
                                     Erroll B. Davis, Jr.
                                     Chairman and Chief Executive Officer

      Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities indicated on the 25th day of March 2003.

<TABLE>
<CAPTION>
          <S>                                                          <C>
/s/ Erroll B. Davis, Jr.         Chairman, Chief Executive Officer and Director (Principal Executive Officer)
-----------------------------
    Erroll B. Davis, Jr.


/s/ Thomas M. Walker             Executive Vice President and Chief Financial Officer (Principal Financial Officer)
-----------------------------
    Thomas M. Walker


/s/ John E. Kratchmer            Vice President-Controller and Chief Accounting Officer (Principal Accounting Officer)
-----------------------------
    John E. Kratchmer



/s/ Alan B. Arends               Director                         /s/ David A. Perdue                 Director
-----------------------------                                     --------------------------------
    Alan B. Arends                                                    David A. Perdue


/s/ Jack B. Evans                Director                         /s/ Judith D. Pyle                  Director
-----------------------------                                     --------------------------------
    Jack B. Evans                                                     Judith D. Pyle


/s/ Joyce L. Hanes               Director                         /s/ Robert W. Schlutz               Director
-----------------------------                                     --------------------------------
    Joyce L. Hanes                                                    Robert W. Schlutz


/s/ Lee Liu                      Director                         /s/ Wayne H. Stoppelmoor            Director
-----------------------------                                     --------------------------------
    Lee Liu                                                           Wayne H. Stoppelmoor


/s/ Katharine C. Lyall           Director                         /s/ Anthony R. Weiler               Director
-----------------------------                                     --------------------------------
    Katharine C. Lyall                                                Anthony R. Weiler


/s/ Singleton B. McAllister      Director
-----------------------------
    Singleton B. McAllister

</TABLE>

                                      136
<PAGE>

                                CERTIFICATIONS

I, Erroll B. Davis, Jr., certify that:

1.  I have reviewed this annual report on Form 10-K of Alliant Energy
    Corporation;

2.  Based on my knowledge, this annual report does not contain any untrue
    statement of a material fact or omit to state a material fact necessary to
    make the statements made, in light of the circumstances under which such
    statements were made, not misleading with respect to the period covered by
    this annual report;

3.  Based on my knowledge, the financial statements, and other financial
    information included in this annual report, fairly present in all material
    respects the financial condition, results of operations and cash flows of
    the registrant as of, and for, the periods presented in this annual report;

4.  The registrant's other certifying officers and I are responsible for
    establishing and maintaining disclosure controls and procedures (as defined
    in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

    a) designed such disclosure controls and procedures to ensure that material
    information   relating  to  the  registrant,   including  its  consolidated
    subsidiaries,  is  made  known  to  us by  others  within  those  entities,
    particularly  during  the  period  in which  this  annual  report  is being
    prepared;

    b) evaluated the effectiveness of the registrant's  disclosure controls and
    procedures  as of a date  within 90 days prior to the  filing  date of this
    annual report (the "Evaluation Date"); and

    c) presented in this annual report our conclusions  about the effectiveness
    of the disclosure controls and procedures based on our evaluation as of the
    Evaluation Date;

5.  The registrant's other certifying officers and I have disclosed, based
    on our most recent evaluation, to the registrant's auditors and the audit
    committee of registrant's board of directors (or persons performing the
    equivalent functions):

    a) all significant deficiencies in the design or operation of internal
    controls  which could  adversely  affect the  registrant's  ability to
    record,  process,   summarize  and  report  financial  data  and  have
    identified for the  registrant's  auditors any material  weaknesses in
    internal controls; and

    b) any fraud,  whether or not material,  that  involves  management or
    other  employees  who  have a  significant  role  in the  registrant's
    internal controls; and

6.  The registrant's other certifying officers and I have indicated in this
    annual report whether there were significant changes in internal controls
    or in other factors that could significantly affect internal controls
    subsequent to the date of our most recent evaluation, including any
    corrective actions with regard to significant deficiencies and material
    weaknesses.





Date:  March 25, 2003

                                               /s/ Erroll B. Davis, Jr.
                                               ------------------------
                                                 Erroll B. Davis, Jr.
                                                Chairman, President and
                                                Chief Executive Officer


                                      137
<PAGE>

I, Thomas M. Walker, certify that:

1.  I have reviewed this annual report on Form 10-K of Alliant Energy
    Corporation;

2.  Based on my knowledge, this annual report does not contain any untrue
    statement of a material fact or omit to state a material fact necessary to
    make the statements made, in light of the circumstances under which such
    statements were made, not misleading with respect to the period covered by
    this annual report;

3.  Based on my knowledge, the financial statements, and other financial
    information included in this annual report, fairly present in all material
    respects the financial condition, results of operations and cash flows of
    the registrant as of, and for, the periods presented in this annual report;

4.  The registrant's other certifying officers and I are responsible for
    establishing and maintaining disclosure controls and procedures (as defined
    in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

    a) designed  such  disclosure  controls and  procedures to ensure that
    material  information  relating  to  the  registrant,   including  its
    consolidated subsidiaries,  is made known to us by others within those
    entities,  particularly  during the period in which this annual report
    is being prepared;

    b) evaluated the effectiveness of the registrant's disclosure controls
    and procedures as of a date within 90 days prior to the filing date of
    this annual report (the "Evaluation Date"); and

    c)  presented  in  this  annual  report  our  conclusions   about  the
    effectiveness  of the disclosure  controls and procedures based on our
    evaluation as of the Evaluation Date;

5.  The registrant's other certifying officers and I have disclosed, based
    on our most recent evaluation, to the registrant's auditors and the audit
    committee of registrant's board of directors (or persons performing the
    equivalent functions):

    a) all significant deficiencies in the design or operation of internal
    controls  which could  adversely  affect the  registrant's  ability to
    record,  process,   summarize  and  report  financial  data  and  have
    identified for the  registrant's  auditors any material  weaknesses in
    internal controls; and

    b) any fraud,  whether or not material,  that  involves  management or
    other  employees  who  have a  significant  role  in the  registrant's
    internal controls; and

6.  The registrant's other certifying officers and I have indicated in this
    annual report whether there were significant changes in internal controls
    or in other factors that could significantly affect internal controls
    subsequent to the date of our most recent evaluation, including any
    corrective actions with regard to significant deficiencies and material
    weaknesses.





Date:  March 25, 2003

                                                 /s/ Thomas M. Walker
                                                 --------------------
                                                   Thomas M. Walker
                                             Executive Vice President and
                                                Chief Financial Officer


                                      138
<PAGE>

I, Erroll B. Davis, Jr., certify that:

1.  I have reviewed this annual report on Form 10-K of Interstate Power and
    Light Company;

2.  Based on my knowledge, this annual report does not contain any untrue
    statement of a material fact or omit to state a material fact necessary to
    make the statements made, in light of the circumstances under which such
    statements were made, not misleading with respect to the period covered by
    this annual report;

3.  Based on my knowledge, the financial statements, and other financial
    information included in this annual report, fairly present in all material
    respects the financial condition, results of operations and cash flows of
    the registrant as of, and for, the periods presented in this annual report;

4.  The registrant's other certifying officers and I are responsible for
    establishing and maintaining disclosure controls and procedures (as defined
    in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

    a) designed  such  disclosure  controls and  procedures to ensure that
    material  information  relating  to  the  registrant,   including  its
    consolidated subsidiaries,  is made known to us by others within those
    entities,  particularly  during the period in which this annual report
    is being prepared;

    b) evaluated the effectiveness of the registrant's disclosure controls
    and procedures as of a date within 90 days prior to the filing date of
    this annual report (the "Evaluation Date"); and

    c)  presented  in  this  annual  report  our  conclusions   about  the
    effectiveness  of the disclosure  controls and procedures based on our
    evaluation as of the Evaluation Date;

5.  The registrant's other certifying officers and I have disclosed, based
    on our most recent evaluation, to the registrant's auditors and the audit
    committee of registrant's board of directors (or persons performing the
    equivalent functions):

    a) all significant deficiencies in the design or operation of internal
    controls  which could  adversely  affect the  registrant's  ability to
    record,  process,   summarize  and  report  financial  data  and  have
    identified for the  registrant's  auditors any material  weaknesses in
    internal controls; and

    b) any fraud,  whether or not material,  that  involves  management or
    other  employees  who  have a  significant  role  in the  registrant's
    internal controls; and

6.  The registrant's other certifying officers and I have indicated in this
    annual report whether there were significant changes in internal controls
    or in other factors that could significantly affect internal controls
    subsequent to the date of our most recent evaluation, including any
    corrective actions with regard to significant deficiencies and material
    weaknesses.





Date:  March 25, 2003

                                               /s/ Erroll B. Davis, Jr.
                                               ------------------------
                                                 Erroll B. Davis, Jr.
                                         Chairman and Chief Executive Officer


                                      139
<PAGE>

I, Thomas M. Walker, certify that:

1.  I have reviewed this annual report on Form 10-K of Interstate Power and
    Light Company;

2.  Based on my knowledge, this annual report does not contain any untrue
    statement of a material fact or omit to state a material fact necessary to
    make the statements made, in light of the circumstances under which such
    statements were made, not misleading with respect to the period covered by
    this annual report;

3.  Based on my knowledge, the financial statements, and other financial
    information included in this annual report, fairly present in all material
    respects the financial condition, results of operations and cash flows of
    the registrant as of, and for, the periods presented in this annual report;

4.  The registrant's other certifying officers and I are responsible for
    establishing and maintaining disclosure controls and procedures (as defined
    in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

    a) designed  such  disclosure  controls and  procedures to ensure that
    material  information  relating  to  the  registrant,   including  its
    consolidated subsidiaries,  is made known to us by others within those
    entities,  particularly  during the period in which this annual report
    is being prepared;

    b) evaluated the effectiveness of the registrant's disclosure controls
    and procedures as of a date within 90 days prior to the filing date of
    this annual report (the "Evaluation Date"); and

    c)  presented  in  this  annual  report  our  conclusions   about  the
    effectiveness  of the disclosure  controls and procedures based on our
    evaluation as of the Evaluation Date;

5.  The registrant's other certifying officers and I have disclosed, based
    on our most recent evaluation, to the registrant's auditors and the audit
    committee of registrant's board of directors (or persons performing the
    equivalent functions):

    a) all significant deficiencies in the design or operation of internal
    controls  which could  adversely  affect the  registrant's  ability to
    record,  process,   summarize  and  report  financial  data  and  have
    identified for the  registrant's  auditors any material  weaknesses in
    internal controls; and

    b) any fraud,  whether or not material,  that  involves  management or
    other  employees  who  have a  significant  role  in the  registrant's
    internal controls; and

6.  The registrant's other certifying officers and I have indicated in this
    annual report whether there were significant changes in internal controls
    or in other factors that could significantly affect internal controls
    subsequent to the date of our most recent evaluation, including any
    corrective actions with regard to significant deficiencies and material
    weaknesses.





Date:  March 25, 2003

                                                 /s/ Thomas M. Walker
                                                 --------------------
                                                   Thomas M. Walker
                                             Executive Vice President and
                                                Chief Financial Officer


                                      140
<PAGE>

I, Erroll B. Davis, Jr., certify that:

1.  I have reviewed this annual report on Form 10-K of Wisconsin Power and
    Light Company;

2.  Based on my knowledge, this annual report does not contain any untrue
    statement of a material fact or omit to state a material fact necessary to
    make the statements made, in light of the circumstances under which such
    statements were made, not misleading with respect to the period covered by
    this annual report;

3.  Based on my knowledge, the financial statements, and other financial
    information included in this annual report, fairly present in all material
    respects the financial condition, results of operations and cash flows of
    the registrant as of, and for, the periods presented in this annual report;

4.  The registrant's other certifying officers and I are responsible for
    establishing and maintaining disclosure controls and procedures (as defined
    in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

    a) designed  such  disclosure  controls and  procedures to ensure that
    material  information  relating  to  the  registrant,   including  its
    consolidated subsidiaries,  is made known to us by others within those
    entities,  particularly  during the period in which this annual report
    is being prepared;

    b) evaluated the effectiveness of the registrant's disclosure controls
    and procedures as of a date within 90 days prior to the filing date of
    this annual report (the "Evaluation Date"); and

    c)  presented  in  this  annual  report  our  conclusions   about  the
    effectiveness  of the disclosure  controls and procedures based on our
    evaluation as of the Evaluation Date;

5.  The registrant's other certifying officers and I have disclosed, based
    on our most recent evaluation, to the registrant's auditors and the audit
    committee of registrant's board of directors (or persons performing the
    equivalent functions):

    a) all significant deficiencies in the design or operation of internal
    controls  which could  adversely  affect the  registrant's  ability to
    record,  process,   summarize  and  report  financial  data  and  have
    identified for the  registrant's  auditors any material  weaknesses in
    internal controls; and

    b) any fraud,  whether or not material,  that  involves  management or
    other  employees  who  have a  significant  role  in the  registrant's
    internal controls; and

6.  The registrant's other certifying officers and I have indicated in this
    annual report whether there were significant changes in internal controls
    or in other factors that could significantly affect internal controls
    subsequent to the date of our most recent evaluation, including any
    corrective actions with regard to significant deficiencies and material
    weaknesses.





Date:  March 25, 2003

                                               /s/ Erroll B. Davis, Jr.
                                               ------------------------
                                                 Erroll B. Davis, Jr.
                                         Chairman and Chief Executive Officer


                                      141
<PAGE>

I, Thomas M. Walker, certify that:

1.  I have reviewed this annual report on Form 10-K of Wisconsin Power and
    Light Company;

2.  Based on my knowledge, this annual report does not contain any untrue
    statement of a material fact or omit to state a material fact necessary to
    make the statements made, in light of the circumstances under which such
    statements were made, not misleading with respect to the period covered by
    this annual report;

3.  Based on my knowledge, the financial statements, and other financial
    information included in this annual report, fairly present in all material
    respects the financial condition, results of operations and cash flows of
    the registrant as of, and for, the periods presented in this annual report;

4.  The registrant's other certifying officers and I are responsible for
    establishing and maintaining disclosure controls and procedures (as defined
    in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

    a) designed  such  disclosure  controls and  procedures to ensure that
    material  information  relating  to  the  registrant,   including  its
    consolidated subsidiaries,  is made known to us by others within those
    entities,  particularly  during the period in which this annual report
    is being prepared;

    b) evaluated the effectiveness of the registrant's disclosure controls
    and procedures as of a date within 90 days prior to the filing date of
    this annual report (the "Evaluation Date"); and

    c)  presented  in  this  annual  report  our  conclusions   about  the
    effectiveness  of the disclosure  controls and procedures based on our
    evaluation as of the Evaluation Date;

5.  The registrant's other certifying officers and I have disclosed, based
    on our most recent evaluation, to the registrant's auditors and the audit
    committee of registrant's board of directors (or persons performing the
    equivalent functions):

    a) all significant deficiencies in the design or operation of internal
    controls  which could  adversely  affect the  registrant's  ability to
    record,  process,   summarize  and  report  financial  data  and  have
    identified for the  registrant's  auditors any material  weaknesses in
    internal controls; and

    b) any fraud,  whether or not material,  that  involves  management or
    other  employees  who  have a  significant  role  in the  registrant's
    internal controls; and

6.  The registrant's other certifying officers and I have indicated in this
    annual report whether there were significant changes in internal controls
    or in other factors that could significantly affect internal controls
    subsequent to the date of our most recent evaluation, including any
    corrective actions with regard to significant deficiencies and material
    weaknesses.





Date:  March 25, 2003

                                                 /s/ Thomas M. Walker
                                                 --------------------
                                                   Thomas M. Walker
                                             Executive Vice President and
                                                Chief Financial Officer




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<PAGE>



                          ALLIANT ENERGY CORPORATION
                      INTERSTATE POWER AND LIGHT COMPANY
                       WISCONSIN POWER AND LIGHT COMPANY

                  Exhibit Index to Annual Report on Form 10-K
                    For the fiscal year ended Dec. 31, 2002

<TABLE>
<CAPTION>
    Exhibit
    Number       Description
    ------       -----------
     <S>             <C>
     3.5a        Articles of Amendment to IP&L's Restated Articles of Incorporation

     4.16a       Fourth Supplemental Indenture, dated as of Dec. 26, 2002, among Resources, Alliant Energy, as
                 Guarantor, and U.S. Bank, as Trustee

     4.17        Registration Rights Agreement, dated as of Dec. 26, 2002, among Resources, Alliant Energy,
                 Merrill Lynch, Pierce, Fenner & Smith Incorporated, Utehdahl Capital Partners, L.P. and The
                 Williams Capital Group, L.P.

     4.18        Registration Rights Agreement, dated as of Dec. 20, 2002, between IP&L and Robert W. Baird & Co.
                 Incorporated

     10.4        364-Day Credit Agreement, dated as of Dec. 27, 2002, among Resources, as Borrower, and Alliant
                 Energy, Heartland Properties, Inc. and International, as Guarantors and the Lenders Named
                 therein and Merrill Lynch Capital Corporation, as Administrative Agent

     10.5        Credit Agreement, dated as of Dec. 20, 2002, among Whiting, as Borrower, the Financial
                 Institutions Listed on Schedule 1.1 thereto, as Banks, Bank One, NA, as Administrative Agent,
                 and Wachovia Bank, National Association, as Syndication Agent

     10.5a       First Amendment to Credit Agreement, dated as of Jan. 7, 2003, by and among Whiting, Bank One,
                 NA, as Administrative Agent and each of the Financial Institutions a Party thereto

     21          Subsidiaries of Alliant Energy and WP&L

     23          Independent Auditors' Consent for Alliant Energy

     99.1        Written Statement of the Chairman, President and CEO Pursuant to 18 U.S.C. Section 1350 for Alliant
                 Energy

     99.2        Written Statement of the EVP and CFO Pursuant to 18 U.S.C. Section 1350 for Alliant Energy

     99.3        Written Statement of the Chairman and CEO Pursuant to 18 U.S.C. Section 1350 for IP&L

     99.4        Written Statement of the EVP and CFO Pursuant to 18 U.S.C. Section 1350 for IP&L

     99.5        Written Statement of the Chairman and CEO Pursuant to 18 U.S.C. Section 1350 for WP&L

     99.6        Written Statement of the EVP and CFO Pursuant to 18 U.S.C. Section 1350 for WP&L

</TABLE>

                                      143