Sallie Mae 2005 Annual Report Download - page 124
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F-2
MANAGEMENT’S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Our management is responsible for establishing and maintaining adequate internal control over
financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended).
Under the supervision and with the participation of our management, including our Chief Executive
Officer and Chief Financial Officer, we assessed the effectiveness of our internal control over financial
reporting as of December 31, 2005. In making this assessment, our management used the criteria
established in Internal Control—Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (“COSO”). Based on our assessment and those criteria,
management concluded that, as of December 31, 2005, our internal control over financial reporting is
effective.
During the year ended December 31, 2005, we acquired a 100 percent interest in GRP/AG Holdings,
LLC (“GRP”). Total assets of GRP represented less than one percent of consolidated total assets as of
December 31, 2005. Total net income of GRP represented less than one percent of consolidated net
income for the year ended December 31, 2005. We have excluded GRP from our assessment of internal
control over financial reporting as of December 31, 2005, and management’s conclusion about the
effectiveness of our internal control over financial reporting does not extend to the internal controls of this
entity. This acquisition was not significant (within the meaning of Rule 11-01(b) of Regulation S-X) to our
consolidated financial statements as of and for the year ended December 31, 2005. This acquisition is
described in Note 11 to the consolidated financial statements, “Acquisitions.”
Our management’s assessment of the effectiveness of the Company’s internal control over financial
reporting as of December 31, 2005 has been audited by PricewaterhouseCoopers LLP, an independent
registered public accounting firm, as stated in their report which appears below.
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.