Pizza Hut 2004 Annual Report Download - page 76

Download and view the complete annual report

Please find page 76 of the 2004 Pizza Hut annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 85

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85

MANAGEMENT’S฀RESPONSIBILITY฀FOR฀FINANCIAL฀STATEMENTS
To฀Our฀Shareholders:
We฀are฀responsible฀for฀the฀preparation,฀integrity฀and฀fair฀presentation฀of฀the฀Consolidated฀Financial฀Statements,฀related฀notes฀
and฀other฀information฀included฀in฀this฀annual฀report.฀The฀financial฀statements฀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฀reporting,฀designed฀to฀provide฀reasonable฀assurance฀as฀to฀the฀reli-
ability฀of฀the฀financial฀statements,฀as฀well฀as฀to฀safeguard฀assets฀from฀unauthorized฀use฀or฀disposition.฀The฀system฀is฀supported฀
by฀formal฀policies฀and฀procedures,฀including฀an฀active฀Code฀of฀Conduct฀program฀intended฀to฀ensure฀employees฀adhere฀to฀the฀
highest฀standards฀of฀personal฀and฀professional฀integrity.฀We฀have฀conducted฀an฀evaluation฀of฀the฀effectiveness฀of฀our฀internal฀
control฀over฀financial฀reporting฀based฀on฀the฀framework฀in฀Internal฀Control฀—฀Integrated฀Framework฀issued฀by฀the฀Committee฀of฀
Sponsoring฀Organizations฀of฀the฀Treadway฀Commission.฀Based฀on฀our฀evaluation,฀we฀concluded฀that฀our฀internal฀control฀over฀
financial฀reporting฀was฀effective฀as฀of฀December฀25,฀2004.฀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฀representations฀made฀to฀the฀independent฀auditors฀were฀valid฀and฀
appropriate.฀Additionally,฀our฀assessment฀of฀the฀effectiveness฀of฀our฀internal฀control฀over฀financial฀reporting฀has฀been฀audited฀
and฀reported฀on฀by฀KPMG฀LLP.
The฀Audit฀Committee฀of฀the฀Board฀of฀Directors,฀which฀is฀composed฀solely฀of฀outside฀directors,฀provides฀oversight฀to฀our฀finan-
cial฀reporting฀process฀and฀our฀controls฀to฀safeguard฀assets฀through฀periodic฀meetings฀with฀our฀independent฀auditors,฀internal฀
auditors฀and฀management.฀Both฀our฀independent฀auditors฀and฀internal฀auditors฀have฀free฀access฀to฀the฀Audit฀Committee.
Although฀no฀cost-effective฀internal฀control฀system฀will฀preclude฀all฀errors฀and฀irregularities,฀we฀believe฀our฀controls฀as฀of฀
December฀25,฀2004฀provide฀reasonable฀assurance฀that฀our฀assets฀are฀reasonably฀safeguarded.
David฀J.฀Deno฀Gregory฀N.฀Moore
Chief฀Financial฀Officer฀and฀Chief฀Operating฀Officer฀ Senior฀Vice฀President฀and฀Controller
MANAGEMENT’S฀REPORT฀ON฀INTERNAL฀CONTROL฀OVER฀FINANCIAL฀REPORTING
Our฀management฀is฀responsible฀for฀establishing฀and฀maintaining฀adequate฀internal฀control฀over฀financial฀reporting,฀as฀such฀
term฀is฀defined฀in฀Rules฀13a-15(f)฀under฀the฀Securities฀Exchange฀Act฀of฀1934.฀Under฀the฀supervision฀and฀with฀the฀participation฀
of฀our฀management,฀including฀our฀principal฀executive฀officer฀and฀principal฀financial฀officer,฀we฀conducted฀an฀evaluation฀of฀the฀
effectiveness฀of฀our฀internal฀controls฀over฀financial฀reporting฀based฀on฀the฀framework฀in฀Internal฀Control฀—฀Integrated฀Framework฀
issued฀by฀the฀Committee฀of฀Sponsoring฀Organizations฀of฀the฀Treadway฀Commission.฀Based฀on฀our฀evaluation฀under฀the฀frame-
work฀in฀Internal฀Control฀—฀Integrated฀Framework,฀our฀management฀concluded฀that฀our฀internal฀control฀over฀financial฀reporting฀was฀
effective฀as฀of฀December฀25,฀2004.฀Our฀management’s฀assessment฀of฀the฀effectiveness฀of฀our฀internal฀control฀over฀financial฀
reporting฀as฀of฀December฀25,฀2004฀has฀been฀audited฀by฀KPMG฀LLP,฀an฀independent฀registered฀public฀accounting฀firm,฀as฀stated฀
in฀their฀report฀which฀is฀included฀herein.
Management’s฀Responsibility฀for฀Financial฀Statements฀and฀
Management’s฀Report฀on฀Internal฀Control฀Over฀Financial฀Reporting
74