INTERNAL CONTROL RPT 2 PSH_INTRNL_CNTRL.htm

 

Report of Independent Registered Public Accounting Firm

 

To the Board of Trustees of ProShares Trust and Shareholders of each of the one hundred fourteen funds listed below

 

In planning and performing our audits of the financial statements of each of the funds listed below (constituting ProShares Trust, hereafter collectively referred to as the “Funds”) as of and for the year or period ended May 31, 2020, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), we considered the Funds’ internal control over financial reporting, including controls over safeguarding securities, as a basis for designing our auditing procedures for the purpose of expressing our opinion on the financial statements and to comply with the requirements of Form N-CEN, but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting.  Accordingly, we do not express an opinion on the effectiveness of the Funds’ internal control over financial reporting.

 

Decline of the Retail Store ETF

 

Short MidCap400

 

UltraPro Dow30SM

DJ Brookfield Global Infrastructure ETF

 

Short MSCI EAFE

 

UltraPro MidCap400

Equities for Rising Rates ETF

 

Short MSCI Emerging Markets

 

UltraPro QQQ

Global Listed Private Equity ETF

 

Short Oil & Gas

 

UltraPro Russell2000

Hedge Replication ETF

 

Short QQQ

 

UltraPro S&P500®

High Yield-Interest Rate Hedged

 

Short Real Estate

 

UltraPro Short 20+ Year Treasury

Inflation Expectations ETF

 

Short Russell2000

 

UltraPro Short Dow30SM

Investment Grade—Interest Rate Hedged

 

Short S&P500®

 

UltraPro Short MidCap400

K-1 Free Crude Oil Strategy ETF

 

Short SmallCap600

 

UltraPro Short QQQ

Large Cap Core Plus

 

Ultra 7-10 Year Treasury

 

UltraPro Short Russell2000

Long Online/Short Stores ETF

 

Ultra 20+ Year Treasury

 

UltraPro Short S&P500®

Managed Futures Strategy ETF

 

Ultra Basic Materials

 

UltraShort 7-10 Year Treasury

Merger ETF

 

Ultra Communication Services Select Sector

 

UltraShort 20+ Year Treasury

Morningstar Alternatives Solution ETF

 

Ultra Consumer Goods

 

UltraShort Basic Materials

MSCI EAFE Dividend Growers ETF

 

Ultra Consumer Services

 

UltraShort Communication Services Select Sector

MSCI Emerging Markets Dividend Growers ETF

 

Ultra Dow30SM

 

UltraShort Consumer Goods

MSCI Europe Dividend Growers ETF

 

Ultra Financials

 

UltraShort Consumer Services

Online Retail ETF

 

Ultra FTSE China 50

 

UltraShort Dow30SM

Pet Care ETF

 

Ultra FTSE Europe

 

UltraShort Financials

RAFITM Long/Short

 

Ultra Health Care

 

UltraShort FTSE China 50

Russell 2000 Dividend Growers ETF

 

Ultra High Yield

 

UltraShort FTSE Europe

Russell U.S. Dividend Growers ETF

 

Ultra Industrials

 

UltraShort Health Care

S&P 500® Bond ETF

 

Ultra MidCap400

 

UltraShort Industrials

S&P 500® Dividend Aristocrats ETF

 

Ultra MSCI Brazil Capped

 

UltraShort MidCap400

S&P 500® Ex-Energy ETF

 

Ultra MSCI EAFE

 

UltraShort MSCI Brazil Capped

S&P 500® Ex-Financials ETF

 

Ultra MSCI Emerging Markets

 

UltraShort MSCI EAFE

S&P 500® Ex-Health Care ETF

 

Ultra MSCI Japan

 

UltraShort MSCI Emerging Markets

S&P 500® Ex-Technology ETF

 

Ultra Nasdaq Biotechnology

 

UltraShort MSCI Japan

S&P MidCap 400® Dividend Aristocrats ETF

 

Ultra Oil & Gas

 

UltraShort Nasdaq Biotechnology

S&P Technology Dividend Aristocrats ETF

 

Ultra QQQ

 

UltraShort Oil & Gas

Short Term USD Emerging Markets Bond ETF

 

Ultra Real Estate

 

UltraShort QQQ

Short 7-10 Year Treasury

 

Ultra Russell2000

 

UltraShort Real Estate

Short 20+ Year Treasury

 

Ultra S&P500®

 

UltraShort Russell2000

Short Basic Materials

 

Ultra Semiconductors

 

UltraShort S&P500®

Short Dow30SM

 

Ultra SmallCap600

 

UltraShort Semiconductors

Short Financials

 

Ultra Technology

 

UltraShort SmallCap600

Short FTSE China 50

 

Ultra Telecommunications

 

UltraShort Technology

Short High Yield

 

Ultra Utilities

 

UltraShort Utilities

 

The management of the Funds is responsible for establishing and maintaining effective internal control over financial reporting. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of controls. A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial

 

 

statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of a company’s assets that could have a material effect on the financial statements.

 

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

A deficiency in internal control over financial reporting exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

 

Our consideration of the Funds’ internal control over financial reporting was for the limited purpose described in the first paragraph and would not necessarily disclose all deficiencies in internal control over financial reporting that might be material weaknesses under standards established by the PCAOB. However, we noted no deficiencies in the Funds’ internal control over financial reporting and their operation, including controls over safeguarding securities, that we consider to be a material weakness as defined above as of May 31, 2020.

 

This report is intended solely for the information and use of the Board of Trustees of ProShares Trust and the Securities and Exchange Commission and is not intended to be and should not be used by anyone other than these specified parties.

 

 

/s/PricewaterhouseCoopers LLP

Baltimore, Maryland

July 27, 2020

 

2