Baker Hughes 2009 Annual Report Download - page 108

34 Baker Hughes Incorporated
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Management’s Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over our financial reporting, as such
term is defined in Exchange Act Rules 13a-15(f). Our internal control over financial reporting is a process designed to provide rea-
sonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. Our control environment is the foundation for our system of internal con-
trol and is embodied in our Business Code of Conduct, which sets the tone of our company and includes our Core Values of Integrity,
Teamwork, Performance and Learning. Included in our system of internal control are written policies, an organizational structure pro-
viding division of responsibilities, the selection and training of qualified personnel and a program of financial and operations reviews
by a professional staff of internal auditors. Our internal control over financial reporting includes those policies and procedures that
(i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of
the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of our
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 (iii) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a
material effect on the financial statements.
Under the supervision and with the participation of our management, including our principal executive officer and principal
financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting. Our evaluation was
based on the framework in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission.
Based on our evaluation under the framework in Internal Control – Integrated Framework, our principal executive officer and
principal financial officer concluded that our internal control over financial reporting was effective as of December 31, 2009. The
conclusion of our principal executive officer and principal financial officer is based on the recognition that there are inherent limita-
tions in all systems of internal control. Because of the inherent limitations of internal control over financial reporting, including the
possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be pre-
vented or detected on a timely basis. 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.
Deloitte & Touche LLP, the Company’s independent registered public accounting firm, has issued an attestation report on the
effectiveness of the Company’s internal control over financial reporting.
Chad C. Deaton Peter A. Ragauss Alan J. Keifer
Chairman, President and Senior Vice President and Vice President and
Chief Executive Officer Chief Financial Officer Controller
Houston, Texas
February 25, 2010