Starwood 2006 Annual Report Download - page 48

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statements for external purposes in accordance with generally accepted accounting principles (“GAAP”) and
includes those policies and procedures that:
kPertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions
and dispositions of the assets of the Company;
kProvide reasonable assurance that the transactions are recorded as necessary to permit the preparation of
financial statements in accordance with GAAP, and the receipts and expenditures of the Company are being
made only in accordance with authorizations of management and directors of the Company; and
kProvide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or
disposition of the Company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. 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 policies or
procedures may deteriorate.
The Company’s management assessed the effectiveness of the Company’s internal controls over financial
reporting as of December 31, 2006. In making this assessment, the Company’s 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 believes that, as of
December 31, 2006, the Company’s internal control over financial reporting is effective.
Management has engaged Ernst & Young LLP, the independent registered public accounting firm that audited
the financial statements included in this Annual Report on Form 10-K, to attest to and report on management’s
evaluation of the Company’s internal control over financial reporting. Its report is included herein.
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