Kodak 2006 Annual Report Download - page 134

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As of December 31, 2006, the Company has remediated the previously reported material weakness in its internal control over financial reporting
related to the completeness and accuracy of the Company’s deferred income tax valuation allowance account. The following remedial actions have
been undertaken:
• With the help of external advisors (other than the Company’s independent registered public accounting firm), standard controls were enhanced
for evaluating world-wide positions with respect to valuation allowances, including quarterly tax packages with standardized documentation to
identify and quantify potential issues;
• Organizational structure changes were made to enhance efficiencies, effectiveness and accountability by aligning the global tax enterprise
structure with the tax processes and controls. Specifically, the Company identified and established key tax positions to ensure tax processes
and key controls are monitored and sustainable over time;
• The Company provided training and education efforts in tax areas, including the deferred income tax valuation allowance account.
In the third and fourth quarters of 2006, the Company has undertaken and completed, as appropriate, its testing to validate compliance with the en-
hanced policies, procedures and controls. The Company has undertaken this testing over these two quarters so as to be able to demonstrate operating
effectiveness over a period of time that is sufficient to support its conclusion. In reviewing the results from this testing, management has concluded
that the internal controls related to the completeness and accuracy of the Company’s deferred income tax valuation allowance account have been
significantly improved and that the above referenced material weakness in internal controls has been remediated as of December 31, 2006.
ITEM 9B. OTHER INFORMATION
None.