ADT 2003 Annual Report Download - page 128

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126
TYCO INTERNATIONAL LTD.
Management’s Responsibility for Financial Statements
DISCUSSION OF MANAGEMENT’S RESPONSIBILITY
We are responsible for the preparation, integrity and fair pres-
entation of the consolidated financial statements and related
information appearing in this report. We take these responsi-
bilities very seriously and are committed to being recognized as
a leader in governance, controls, clarity and transparency of
financial statements. We are committed to making honesty,
integrity and transparency the hallmarks of how we run Tyco.
We believe that to succeed in today’s environment requires
more than just compliance with laws and regulations
—
it
requires a culture based upon the highest levels of integrity and
ethical values. Expected behavior starts with our Board of
Directors and our senior team leading by example and includes
every one of Tyco’s approximately 258,600 global employees, as
well as our customers, suppliers and business partners. One of
our most crucial objectives is restoring public, employee and
shareholder confidence in Tyco. We believe this can be accom-
plished; first, by issuing financial information and related dis-
closures that are accurate, complete and transparent so
investors are well informed; second, by supporting a leadership
culture based on an ethic of uncompromising integrity and
accountability; and third, by recruiting, training and retaining
high-performance individuals who have the highest ethical
standards. We take full responsibility for meeting this objective,
adopting appropriate accounting standards, designing and
maintaining adequate systems of internal and disclosure controls
and devoting our full commitment and the necessary resources
to these items.
DEDICATION TO GOVERNANCE, CONTROLS AND
FINANCIAL REPORTING
For a number of us at Tyco, 2003 was our first full year in our
roles. We have made significant progress designing, maintaining
and monitoring internal controls over financial reporting and
disclosures and improving our corporate governance practices,
many of which are discussed in Tyco’s Annual Report on Form
10-K. We believe that a strong control environment is a dynamic
process and therefore, intend to continue to devote substantial
resources to this effort. The Company has continually assessed
and improved its controls during 2003, and we believe the
controls provide reasonable assurance that the Company’s
assets are safeguarded, transactions are in accordance with
authorizations and that financial records are reliable for our
financial statements.
While we are pleased with our corporate governance and con-
trol improvements during 2003, we still have much more to
accomplish in a dynamic and quite complex environment. We
recognize that a culture and control environment cannot be com-
pletely implemented in one year. With the goal of identifying and
remediating control deficiencies in a timely manner, we are con-
tinuing to devote substantial resources to document and test the
effectiveness of all aspects of our internal and disclosure controls.
This is being done at approximately 2,300 subsidiaries through-
out the world. It will take some time and experience, however,
before we are confident that we have in place all of the rigorous
and effective controls that we and our Board of Directors desire.
We welcome the oversight of our financial reporting activi-
ties by our independent auditors, PricewaterhouseCoopers LLP
(“PwC”). In its audit testing, PwC takes into consideration our
internal control environment. Our Audit Committee meets
regularly and separately with management, PwC and our inter-
nal auditors to discuss financial reports, controls and auditing.
We, our Board, and Audit Committee are all committed to
excellence in governance, financial reporting and controls.
Edward D. Breen
Chairman and Chief Executive Officer
David J. FitzPatrick
Executive Vice President and
Chief Financial Officer