Kraft 2007 Annual Report Download - page 99

Report of Independent Registered Public Accounting Firm
To the Board of Directors and Shareholders of Kraft Foods Inc.:
In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of earnings, of
shareholders’ equity and of cash flows present fairly, in all material respects, the financial position of Kraft Foods Inc. and its
subsidiaries at December 31, 2007 and December 31, 2006 and the results of their operations and their cash flows for each of
the three years in the period ended December 31, 2007 in conformity with accounting principles generally accepted in the
United States of America. Also in our opinion, the Company maintained, in all material respects, effective 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 (COSO). The Company’s management is responsible
for these financial statements, 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 Report of Management on Internal
Control over Financial Reporting. Our responsibility is to express opinions on these financial statements and on the Company’s
internal control over financial reporting based on our integrated 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 audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and
whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial
statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial
statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal
control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and
operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures
as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
As discussed in Note 1 and Note 9 to the consolidated financial statements, the Company changed the manner in which it accounts
for pension, postretirement and postemployment plans in 2006 and the manner in which it accounts for uncertain tax positions and
the timing of its annual goodwill and indefinite-lived intangible assets impairment tests in 2007.
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 (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.
As described in Management’s Report on Internal Control over Financial Reporting, management has excluded Groupe Danone
S.A.’s global biscuit operations (“Danone Biscuit”) from its assessment of internal control over financial reporting as of
December 31, 2007 because it was acquired by the Company in a purchase business combination during 2007. We have also
excluded Danone Biscuit from our audit of internal control over financial reporting. Danone Biscuit is a wholly-owned
subsidiary whose total assets and total revenues represent 14% and 0%, respectively, of the related consolidated financial
statement amounts as of and for the year ended December 31, 2007.
/s/ P RICEWATERHOUSE C OOPERS LLP
Chicago, Illinois
February 22, 2008
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