Amazon.com 2002 Annual Report Download - page 54

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REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
The Board of Directors and Stockholders
Amazon.com, Inc.
We have audited the accompanying consolidated balance sheets of Amazon.com, Inc. as of
December 31, 2002 and 2001, and the related consolidated statements of operations, stockholders' equity
(deÑcit) and cash Öows for each of the three years in the period ended December 31, 2002. Our audits
also included the Ñnancial statement schedule listed at Item 15(a)(2). These Ñnancial statements and
schedule are the responsibility of the Company's management. Our responsibility is to express an opinion
on these Ñnancial statements and schedule based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the United
States. Those standards require that we plan and perform the audit to obtain reasonable assurance about
whether the Ñnancial statements are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the Ñnancial statements. An audit also includes
assessing the accounting principles used and signiÑcant estimates made by management, as well as
evaluating the overall Ñnancial statement presentation. We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, the Ñnancial statements referred to above present fairly, in all material respects, the
consolidated Ñnancial position of Amazon.com, Inc. at December 31, 2002 and 2001, and the consolidated
results of its operations and its cash Öows for each of the three years in the period ended December 31,
2002, in conformity with accounting principles generally accepted in the United States. Also, in our
opinion, the related Ñnancial statement schedule, when considered in relation to the basic Ñnancial
statements taken as a whole, presents fairly in all material respects the information set forth therein.
As discussed in Note 1 to the consolidated Ñnancial statements, the Company adopted the full
provisions of Statement of Financial Accounting Standards No. 141, Business Combinations, and No. 142,
Goodwill and Other Intangible Assets, eÅective January 1, 2002. The Company also adopted Statement of
Financial Accounting Standards No. 133, Accounting for Derivative Instruments and Hedging Activities,
eÅective January 1, 2001. In addition, as discussed in Note 1 to the consolidated Ñnancial statements,
eÅective January 1, 2002, the Company prospectively changed its inventory costing method to the Ñrst-in
Ñrst-out method of accounting.
/s/ E
RNST
& Y
OUNG
LLP
Seattle, Washington
January 17, 2003
45