Estee Lauder 2007 Annual Report Download - page 88

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Management of The Estée Lauder Companies Inc. (including its subsidiaries) (the “Company”) is responsible for
establishing and maintaining adequate internal control over fi nancial reporting (as defi ned in Rules13a-15(f) of the
Securities Exchange Act of 1934, as amended).
A company’s internal control over fi nancial reporting is a process designed to provide reasonable assurance regarding
the reliability of fi nancial reporting and the preparation of fi nancial statements for external purposes in accordance
with U.S. generally accepted accounting principles. A company’s internal control over fi nancial reporting includes those
policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly
refl ect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions
are recorded as necessary to permit preparation of fi nancial statements in accordance with U.S. 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 (3) 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 fi nancial statements.
Because of its inherent limitations, internal control over fi nancial 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.
Under the supervision of and with the participation of the Chief Executive Offi cer and the Chief Financial Offi cer,
the Company’s management conducted an assessment of the effectiveness of the Company’s internal control over
fi nancial reporting based on the framework and criteria established in Internal Control — Integrated Framework, issued
by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, the
Company’s management has concluded that, as of June 30, 2007, the Company’s internal control over fi nancial
reporting was effective.
KPMG LLP, the independent registered public accounting fi rm that audits the Company’s consolidated fi nancial statements
has issued its attestation report on management’s assessment of internal control over fi nancial reporting. That attestation
report follows this report.
William P. Lauder Richard W. Kunes
President and Chief Executive Offi cer Executive Vice President and Chief Financial Offi cer
August 27, 2007
THE EST{E LAUDER COMPANIES INC. 87
MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING