Capital One 2015 Annual Report Download - page 130

111 Capital One Financial Corporation (COF)
MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
The management of Capital One Financial Corporation (the “Company” or “Capital One”) is responsible for establishing and
maintaining adequate internal control over financial reporting and for the assessment of the effectiveness of internal control over
financial reporting. Internal control over financial reporting is a process designed by, or under the supervision of, the Company’s
principal executive and principal financial officers, or persons performing similar functions, and effected by the Company’s Board
of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and
the preparation of financial statements for external reporting purposes in accordance with U.S. generally accepted accounting
principles.
Capital One’s 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 Company’s assets;
(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that the Company’s receipts and expenditures are being made only
in accordance with authorizations of the Company’s management and directors; and (iii) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material
effect on its 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.
Management conducted an assessment of the effectiveness of the Company’s internal control over financial reporting as of
December 31, 2015, based on the framework in “2013 Internal Control—Integrated Framework” issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO), commonly referred to as the “2013 Framework.” As allowed
for by the SEC under the current year acquisition scope exception, management’s assessment of the effectiveness of the internal
control over financial reporting excludes the evaluation of the internal controls over financial reporting of the Healthcare Financial
Services business of General Electric Capital Corporation, which was acquired on December 1, 2015. As part of this acquisition,
we recorded approximately $9.2 billion in assets, including $8.3 billion of loans.
Based on this assessment, management concluded that, as of December 31, 2015, the Company’s internal control over financial
reporting was effective based on the criteria established by COSO in the 2013 Framework. Additionally, based upon management’s
assessment, the Company determined that there were no material weaknesses in its internal control over financial reporting as of
December 31, 2015.
The effectiveness of the Company’s internal control over financial reporting as of December 31, 2015, has been audited by Ernst &
Young LLP, an independent registered public accounting firm, as stated in their accompanying report, which expresses an
unqualified opinion on the effectiveness of the Company’s internal control over financial reporting as of December 31, 2015.
/s/ RICHARD D. FAIRBANK
Richard D. Fairbank
Chair, Chief Executive Officer and President
/s/ STEPHEN S. CRAWFORD
Stephen S. Crawford
Chief Financial Officer
February 25, 2016