Pizza Hut 2002 Annual Report Download - page 75

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REPORT OF INDEPENDENT
AUDITORS
MANAGEMENT’S RESPONSIBILITY
FOR FINANCIAL STATEMENTS
TO OUR SHAREHOLDERS:
We are responsible for the preparation, integrity and fair presen-
tation of the Consolidated Financial Statements, related notes and
other information included in this annual report. The financial state-
ments were prepared in accordance with accounting principles
generally accepted in the United States of America and include
certain amounts based upon our estimates and assumptions, as
required. Other financial information presented in the annual
report is derived from the financial statements.
We maintain a system of internal control over financial report-
ing, designed to provide reasonable assurance as to the reliability
of the financial statements, as well as to safeguard assets from
unauthorized use or disposition. The system is supported by for-
mal policies and procedures, including an active Code of Conduct
program intended to ensure employees adhere to the highest
standards of personal and professional integrity. Our internal audit
function monitors and reports on the adequacy of and compliance
with the internal control system, and appropriate actions are taken
to address significant control deficiencies and other opportunities
for improving the system as they are identified.
The Consolidated Financial Statements have been audited
and reported on by our independent auditors, KPMG LLP, who
were given free access to all financial records and related data,
including minutes of the meetings of the Board of Directors and
Committees of the Board. We believe that management repre-
sentations made to the independent auditors were valid and
appropriate.
The Audit Committee of the Board of Directors, which is com-
posed solely of outside directors, provides oversight to our financial
reporting process and our controls to safeguard assets through
periodic meetings with our independent auditors, internal audi-
tors and management. Both our independent auditors and
internal auditors have free access to the Audit Committee.
Although no cost-effective internal control system will pre-
clude all errors and irregularities, we believe our controls as of
December 28, 2002 provide reasonable assurance that our assets
are reasonably safeguarded.
David J. Deno
Chief Financial Officer
THE BOARD OF DIRECTORS
YUM! BRANDS, INC.:
We have audited the accompanying consolidated balance sheets
of YUM! Brands, Inc. and Subsidiaries (“YUM”) (formerly TRICON
Global Restaurants, Inc.) as of December 28, 2002 and December
29, 2001, and the related consolidated statements of income, cash
flows and shareholders’ equity (deficit) and comprehensive income
for each of the years in the three-year period ended December 28,
2002. These consolidated financial statements are the responsi-
bility of YUM’s management. Our responsibility is to express an
opinion on these consolidated financial statements based on our
audits.
We conducted our audits in accordance with auditing stan-
dards generally accepted in the United States of America. 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 consolidated financial statements referred
to above present fairly, in all material respects, the financial posi-
tion of YUM as of December 28, 2002 and December 29, 2001,
and the results of its operations and its cash flows for each of the
years in the three-year period ended December 28, 2002, in con-
formity with accounting principles generally accepted in the United
States of America.
As discussed in Notes 2 and 12 to the consolidated financial
statements, YUM adopted the provisions of the Financial
Accounting Standards Board’s Statement of Financial Accounting
Standards No. 142, “Goodwill and Other Intangible Assets,” in 2002.
KPMG LLP
Louisville, Kentucky
February 7, 2003
73.
Yum! Brands Inc.