SanDisk 2012 Annual Report Download - page 161

This is a TAB type table. Insert
conts here. Annual Report
Notwithstanding our efforts to mitigate some foreign exchange risks, we do not hedge all of our foreign
currency exposures, and there can be no assurances that our mitigating activities related to the exposures that we
hedge will adequately protect us against risks associated with foreign currency fluctuations.
Market Risk. With the U.S. long-term sovereign credit rating below the highest available rating and the risk
of additional future downgrades or related downgrades by recognized credit rating agencies, the investment
choices for our cash and marketable securities portfolio could be reduced, which could negatively impact our
non-operating results. We do not have direct ownership of European sovereign debt in our investment
portfolio. Sales to Europe accounted for approximately 13% of our total revenues in fiscal year 2012, and
continuing uncertainties in the European financial markets could impact our revenues and financial condition in
Europe or elsewhere.
All of the potential changes noted above are based on sensitivity analyses performed on our financial
position at December 30, 2012. Actual results may differ materially.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this item is set forth beginning at page F-1.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Not applicable.
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures. Our management has evaluated, under the supervision
and with the participation of our Chief Executive Officer and Chief Financial Officer, the effectiveness of our
disclosure controls and procedures as of December 30, 2012. Based on their evaluation as of December 30, 2012,
our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and
procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended,
or the Exchange Act) were effective at the reasonable assurance level to ensure that the information required to
be disclosed by us in this Annual Report on Form 10-K was (i) recorded, processed, summarized and reported
within the time periods specified in the SEC’s rules and regulations and (ii) accumulated and communicated to
our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions
regarding required disclosure.
There were no changes in our internal control over financial reporting (as defined in Exchange Act Rule
13a-15(f)) during the quarter ended December 30, 2012 that have materially affected, or are reasonably likely to
materially affect, our internal control over financial reporting.
Report of Management on Internal Control Over Financial Reporting. Our management is responsible for
establishing and maintaining a comprehensive system of internal control over financial reporting to provide
reasonable assurance of the proper authorization of transactions, the safeguarding of assets and the reliability of
financial records. Our internal control system was designed to provide reasonable assurance to our management
and board of directors regarding the preparation and fair presentation of published financial statements. The
system of internal control over financial reporting provides for appropriate division of responsibility and is
documented by written policies and procedures that are communicated to employees. The framework upon which
management relied in evaluating the effectiveness of our internal control over financial reporting was set forth in
Internal Controls — Integrated Framework published by the Committee of Sponsoring Organizations of the
Treadway Commission.
55