Samsung 2006 Annual Report Download - page 72

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62
Report of Independent Auditors
We have audited the accompanying consolidated balance sheets
of Samsung Electronics Co., Ltd. and its subsidiaries (collectively
referred to as the “Company”) as of December 31, 2006 and 2005,
and the related consolidated statements of income, changes in
shareholders’ equity and cash flows for the years then ended,
expressed in Korean won. These financial statements are the
responsibility of the Company’s management. Our responsibility
is to express an opinion on these financial statements based on
our audits. We did not audit the financial statements of Samsung
Card Co., Ltd. and certain other subsidiaries, whose statements
reflect total assets representing 19% and 22% of the consolidated
total assets as of December 31, 2006 and 2005, respectively, and
total revenues representing 19% of the consolidated total revenues
for both years then ended. Those statements were audited by
other auditors whose reports thereon have been furnished us, and
our opinion expressed herein, insofar as it relates to the amounts
included for those companies, is based solely on the reports of the
other auditors.
We conducted our audits in accordance with auditing standards
generally accepted in the Republic of Korea. 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
To the Board of Directors and Shareholders of
Samsung Electronics Co., Ltd. and Subsidiaries
management, as well as evaluating the overall financial statement
presentation. We believe that our audits and the reports of the
other auditors provide a reasonable basis for our opinion.
In our opinion, based on our audits and the reports of the other
auditors, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of
Samsung Electronics Co., Ltd. and its subsidiaries as of December
31, 2006 and 2005, and the results of their operations, the changes
in their shareholders’ equity and their cash flows for the years then
ended in conformity with accounting principles generally accepted
in the Republic of Korea.
Without qualifying our opinion, we draw your attention to the
following matters.
As discussed in Note 19 to the accompanying consolidated
financial statements, Samsung Electronics Co., Ltd. (“SEC”) and
30 other Samsung Group affiliates (the “Affiliates”) entered into
an agreement with the institutional creditors (the “Creditors”) of
Samsung Motors Inc. (“SMI”) in September 1999. In accordance
with this agreement, SEC and the Affiliates agreed to sell 3,500,000
shares of Samsung Life Insurance Co., Ltd. (the “Shares”),
which were previously transferred to the Creditors in connection
with the petition for court receivership of SMI. The Shares
were to be disposed of by December 31, 2000, and if the sales
proceeds fell short of \2,450 billion (the “Shortfall”), SEC and