Cisco 2005 Annual Report Download - page 13

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Reports of Management
16
John T. Chambers
President and Chief Executive Ofcer
September 16, 2005
Dennis D. Powell
Senior Vice President and Chief Financial Ofcer
September 16, 2005
Statement of Management’s Responsibility
Cisco’s management has always assumed full accountability for maintaining compliance with our established financial accounting
policies and for reporting our results with objectivity and the highest degree of integrity. It is critical for investors and other users
of the Consolidated Financial Statements to have confidence that the financial information that we provide is timely, complete,
relevant, and accurate. Management is responsible for the fair presentation of Cisco’s Consolidated Financial Statements, prepared
in accordance with generally accepted accounting principles (GAAP), and has full responsibility for their integrity and accuracy.
Management, with oversight by Cisco’s Board of Directors, has established and maintains a strong ethical climate so that our
affairs are conducted to the highest standards of personal and corporate conduct. Management also has established an effective
system of internal control over financial reporting. Cisco’s policies and practices reflect corporate governance initiatives that are
compliant with the listing requirements of NASDAQ and the corporate governance requirements of the Sarbanes-Oxley Act of 2002.
We are committed to enhancing shareholder value and fully understand and embrace our fiduciary oversight responsibilities.
We are dedicated to ensuring that our high standards of financial accounting and reporting as well as our underlying system of
internal controls are maintained. Our culture demands integrity and we have the highest confidence in our processes, our internal
controls, and our people, who are objective in their responsibilities and who operate under the highest level of ethical standards.
Management’s Report on Internal Control Over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting for Cisco. 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.
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 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 the 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.
Management (with the participation of the principal executive officer and principal financial officer) conducted an evaluation
of the effectiveness of Cisco’s internal control over financial reporting based on the framework in Internal Control—Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management
concluded that Cisco’s internal control over financial reporting was effective as of July 30, 2005. Management’s assessment of the
effectiveness of Cisco’s internal control over financial reporting as of July 30, 2005 has been audited by PricewaterhouseCoopers LLP,
an independent registered public accounting firm, as stated in their report which is included herein.