KeyBank 2007 Annual Report Download - page 62

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60
KEYCORP AND SUBSIDIARIES
Shareholders and Board of Directors
KeyCorp
We have audited the accompanying consolidated balance sheets of
KeyCorp and subsidiaries as of December 31, 2007 and 2006, and the
related consolidated statements of income, changes in shareholders’
equity, and cash flows for each of the three years in the period ended
December 31, 2007. These financial statements are the responsibility of
KeyCorp’s management. Our responsibility is to express an opinion on
these financial statements based on our audits.
We conducted our audits in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Those
standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of KeyCorp
and subsidiaries as of December 31, 2007 and 2006, and the consolidated
results of their operations and their cash flows for each of the three years
in the period ended December 31, 2007, in conformity with U.S. generally
accepted accounting principles.
As discussed in Note 1 to the consolidated financial statements,
KeyCorp changed its method of accounting for defined benefit pension
and other postretirement plans as of December 31, 2006, in accordance
with the Financial Accounting Standards Board Statement No. 158,
Employers’ Accounting for Defined Benefit Pension and Other
Postretirement Plans.
We also have audited, in accordance with the standards of the Public
Company Accounting Oversight Board (United States), KeyCorp’s
internal control over financial reporting as of December 31, 2007,
based on criteria established in “Internal Control — Integrated
Framework” issued by the Committee of Sponsoring Organizations of
the Treadway Commission, and our report dated February 22, 2008,
expressed an unqualified opinion thereon.
Cleveland, Ohio
February 22, 2008
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Shareholders and Board of Directors
KeyCorp
We have audited KeyCorp’s internal control over financial reporting as
of December 31, 2007, based on criteria established in “Internal
Control — Integrated Framework” issued by the Committee of
Sponsoring Organizations of the Treadway Commission (the COSO
criteria). KeyCorp’s management is responsible for maintaining effective
internal control over financial reporting and for its assessment of the
effectiveness of internal control over financial reporting included in the
accompanying Management’s Annual Report on Internal Control Over
Financial Reporting. Our responsibility is to express an opinion on the
company’s internal control over financial reporting based on our audit.
We conducted our audit in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable
assurance about whether effective internal control over financial
reporting was maintained in all material respects. Our audit included
obtaining an understanding of internal control over financial reporting,
assessing the risk that a material weakness exists, testing and evaluating
the design and operating effectiveness of internal control based on the
assessed risk, and performing such other procedures as we considered
necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinion.
A company’s 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. A company’s internal control over financial reporting includes
those policies and procedures that (1) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (2) 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 (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 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.
In our opinion, KeyCorp maintained, in all material respects, effective
internal control over financial reporting as of December 31, 2007,
based on the COSO criteria.
We have also audited, in accordance with the standards of the Public
Company Accounting Oversight Board (United States), the consolidated
balance sheets of KeyCorp as of December 31, 2007 and 2006, and the
related consolidated statements of income, changes in shareholders’
equity, and cash flows for each of the three years in the period ended
December 31, 2007 and our report dated February 22, 2008 expressed
an unqualified opinion thereon.
Cleveland, Ohio
February 22, 2008
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
ON INTERNAL CONTROL OVER FINANCIAL REPORTING