Sunoco 2003 Annual Report Download - page 69

Report of Management
To the Shareholders of Sunoco, Inc.
The accompanying consolidated financial statements of
Sunoco, Inc. and its subsidiaries (“Sunoco”) and the re-
lated information are the responsibility of management.
The financial statements, which include amounts based
on informed estimates and judgments, were prepared us-
ing accounting principles generally accepted in the
United States and deemed appropriate in the circum-
stances. Management believes that these financial state-
ments present fairly, in all material respects, Sunoco’s
financial position, results of operations and cash flows.
Other financial information presented in this Annual
Report is consistent with that in the financial statements.
To fulfill its responsibility for the financial statements,
Sunoco maintains a system of internal control which in
management’s opinion provides reasonable assurance of
achieving the objectives of internal control. These ob-
jectives include safeguarding of assets from loss through
unauthorized use or disposition and maintaining reliable
records permitting the preparation of financial statements
and accountability for assets. The system of internal con-
trol is subject to ongoing evaluation of its continuing
effectiveness.
Sunoco’s independent auditors, Ernst & Young LLP, have
expressed an opinion on the fairness of the Company’s
financial statements in their report presented on this page.
The Audit Committee of the Board of Directors, which
met fourteen times during 2003, is comprised only of di-
rectors who meet the independence requirements of the
NewYork Stock Exchange and the rules and regulations
of the Securities and Exchange Commission. It assists the
Board of Directors in discharging its duties relating to
accounting and reporting practices and internal control,
and it assesses the performance and approves the
appointment of the independent auditors, and recom-
mends the ratification of their appointment to the share-
holders. Both the independent auditors and Sunoco’s
internal auditors have unrestricted access to the Commit-
tee to discuss audit findings and other financial matters.
John G. Drosdick
Chairman, Chief Executive Officer & President
Thomas W. Hofmann
Senior Vice President & Chief Financial Officer
Report of Independent Auditors
To the Shareholders and Board of Directors,
Sunoco, Inc.
We have audited the accompanying consolidated balance
sheets of Sunoco, Inc. and subsidiaries as of December 31,
2003 and 2002, and the related consolidated statements
of operations, comprehensive income and shareholders’
equity and cash flows for each of the three years in the
period ended December 31, 2003. These financial state-
ments are the responsibility of the Company’s manage-
ment. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with auditing
standards generally accepted in the United States. 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 management, as
well as evaluating the overall financial statement pre-
sentation. We believe that our audits provide a reason-
able basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the consolidated
financial position of Sunoco, Inc. and subsidiaries at De-
cember 31, 2003 and 2002 and the consolidated results of
their operations and their cash flows for each of the three
years in the period ended December 31, 2003, in con-
formity with accounting principles generally accepted in
the United States.
As discussed in Note 1 to the consolidated financial state-
ments, the Company changed its methods of accounting
for goodwill and other indefinite-lived intangible assets
and employee stock compensation plans in 2002.
Philadelphia, Pennsylvania
February 13, 2004
67