Pfizer 2006 Annual Report Download - page 37

2006 Financial Report 35
Management’s Report
We prepared and are responsible for the financial statements that
appear in our 2006 Financial Report. These financial statements
are in conformity with accounting principles generally accepted
in the United States of America and, therefore, include amounts
based on informed judgments and estimates. We also accept
responsibility for the preparation of other financial information
that is included in this document.
Report on Internal Control Over Financial Reporting
The management of the Company is responsible for establishing
and maintaining adequate internal control over financial reporting
as defined in Rules 13a-15(f) and 15d-15(f) under the Securities
Exchange Act of 1934. The Company’s internal control over
financial reporting is 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 in the United States of
America. The 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. Management
assessed the effectiveness of the Company’s internal control over
financial reporting as of December 31, 2006. In making this
assessment, management used the criteria set forth by the
Committee of Sponsoring Organizations of the Treadway
Commission in Internal Control-Integrated Framework. Based on
our assessment and those criteria, management believes that
the Company maintained effective internal control over financial
reporting as of December 31, 2006.
The Company’s independent auditors have issued their auditors’
report on management’s assessment of the Company’s internal
control over financial reporting. That report appears in our 2006
Financial Report under the heading, Report of Independent
Registered Public Accounting Firm on Internal Control Over
Financial Reporting.
Jeffrey B. Kindler
Chairman and Chief Executive Officer
Alan G. Levin Loretta V. Cangialosi
Principal Financial Officer Principal Accounting Officer
February 27, 2007
The Audit Committee reviews the Company’s financial reporting
process on behalf of the Board of Directors. Management has the
primary responsibility for the financial statements and the
reporting process, including the system of internal controls.
In this context, the Committee has met and held discussions with
management and the independent registered public accounting
firm regarding the fair and complete presentation of the
Company’s results and the assessment of the Company’s internal
control over financial reporting. The Committee has discussed
significant accounting policies applied by the Company in its
financial statements, as well as alternative treatments.
Management represented to the Committee that the Company’s
consolidated financial statements were prepared in accordance
with accounting principles generally accepted in the United States
of America, and the Committee has reviewed and discussed the
consolidated financial statements with management and the
independent registered public accounting firm. The Committee
discussed with the independent registered public accounting
firm matters required to be discussed by Statement of Auditing
Standards No. 61, Communication with Audit Committees.
In addition, the Committee has reviewed and discussed with the
independent registered public accounting firm the auditors’
independence from the Company and its management. As part
of that review, the Committee received the written disclosures and
letter required by the Independence Standards Board Standard
No. 1, Independence Discussions with Audit Committees and by
all relevant professional and regulatory standards relating to
KPMG’s independence from the Company. The Committee also has
considered whether the independent registered public accounting
firm’s provision of non-audit services to the Company is compatible
with the auditors’ independence. The Committee has concluded
that the independent registered public accounting firm is
independent from the Company and its management.
The Committee reviewed and discussed Company policies with
respect to risk assessment and risk management.
The Committee discussed with the Company’s internal auditors and
the independent registered public accounting firm the overall
scope and plans for their respective audits. The Committee met
with the internal auditors and the independent registered public
accounting firm, with and without management present, to
discuss the results of their examinations, the evaluations of the
Company’s internal controls, and the overall quality of the
Company’s financial reporting.
In reliance on the reviews and discussions referred to above, the
Committee recommended to the Board of Directors, and the Board
has approved, that the audited financial statements be included in
the Company’s Annual Report on Form 10-K for the year ended
December 31, 2006, for filing with the Securities and Exchange
Commission. The Committee has selected and the Board of Directors
has ratified, subject to shareholder ratification, the selection of the
Company’s independent registered public accounting firm.
W.R. Howell
Chair, Audit Committee
February 27, 2007
The Audit Committee’s Report shall not be deemed to be filed or
incorporated by reference into any Company filing under the
Securities Act of 1933, as amended, or the Securities Exchange Act
of 1934, as amended, except to the extent that the Company
specifically incorporates the Audit Committee’s Report by
reference therein.
Management’s Report on Internal Control
Over Financial Reporting
Audit Committee’s Report