HR Block 2007 Annual Report Download - page 121

Download and view the complete annual report

Please find page 121 of the 2007 HR Block annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 133

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
(a) EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES –Officer and Chief Financial Officer. Based on this evaluation, our Chief
We have established disclosure controls and procedures (Disclosure Executive Officer and Chief Financial Officer have concluded that our
Controls) to ensure that information required to be disclosed in the Disclosure Controls were effective as of the end of the period covered
Company’s reports filed under the Securities Exchange Act of 1934, as by this Annual Report on Form 10-K.
amended, is recorded, processed, summarized and reported within the (b) MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER
time periods specified in the U.S. Securities and Exchange FINANCIAL REPORTING –Management is responsible for establishing
Commission’s rules and forms. Disclosure Controls are also designed to and maintaining adequate internal control over financial reporting, as
ensure that such information is accumulated and communicated to such term is defined in Exchange Act Rules 13a-15(f). Under the
management, including the CEO and CFO, as appropriate to allow supervision and with the participation of management, including our
timely decisions regarding required disclosure. Our Disclosure Controls Chief Executive Officer and Chief Financial Officer, we conducted an
were designed to provide reasonable assurance that the controls and evaluation of the effectiveness of our internal control over financial
procedures would meet their objectives. Our management, including the reporting based on the framework in ‘‘Internal Control –Integrated
Chief Executive Officer and Chief Financial Officer, does not expect Framework’’ issued by the Committee of Sponsoring Organizations of
that our Disclosure Controls will prevent all error and all fraud. A the Treadway Commission (COSO) as of April 30, 2007.
control system, no matter how well designed and operated, can provide Based on our assessment, management concluded that, as of April 30,
only reasonable assurance of achieving the designed control objectives 2007, the Company’s internal control over financial reporting was
and management is required to apply its judgment in evaluating the effective based on the criteria set forth by COSO.
cost-benefit relationship of possible controls and procedures. Because The Company’s external auditors, KPMG LLP, an independent
of the inherent limitations in all control systems, no evaluation of registered public accounting firm, have issued an audit report on our
93 m
controls can provide absolute assurance that all control issues and assessment of the Company’s internal control over financial reporting.
instances of fraud, if any, within the Company have been detected. This report appears near the beginning of Item 8.
These inherent limitations include the realities that judgments in (c)CHANGES IN INTERNAL CONTROL OVER FINANCIAL
decision-making can be faulty, and that breakdowns can occur because REPORTING –During the quarter ended April 30, 2007, there were no
of simple error or mistake. Additionally, controls can be circumvented changes that materially affected, or are reasonably likely to materially
by the individual acts of some persons, by collusions of two or more affect, our internal control over financial reporting. As described in our
people, or by management override of the control. Because of the Form 10-Q for the quarter ended January 31, 2007, the process for
inherent limitations in a cost-effective, maturing control system, valuing certain residual interests in securitizations was enhanced at the
misstatements due to error or fraud may occur and not be detected. time of our third quarter filing. The residual valuation process was
As of the end of the period covered by this Form 10-K, we evaluated effectively executed for the quarter ended April 30, 2007, such that there
the effectiveness of the design and operation of our Disclosure was no material weakness in internal controls over financial reporting
Controls. The controls evaluation was done under the supervision and as of April 30, 2007.
with the participation of management, including our Chief Executive
ITEM 9B. OTHER INFORMATION
None.
H&R BLOCK 2007 Form 10K