Symantec 2006 Annual Report Download - page 74

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Board of Directors and Stockholders
Symantec Corporation:
We have audited management's assessment, included in the accompanying Management's Report on
Internal Control over Financial Reporting appearing under Item 9A(b), that Symantec Corporation and
subsidiaries (the Company) did not maintain effective internal control over financial reporting as of March 31,
2006 because of the effect of a material weakness identified in management's assessment based on criteria
established in Internal Control Ì Integrated Framework issued by the Committee of Sponsoring Organiza-
tions of the Treadway Commission (COSO). Symantec Corporation's management is responsible for
maintaining effective internal control over financial reporting and for its assessment of the effectiveness of
internal control over financial reporting. Our responsibility is to express an opinion on management's
assessment and an opinion on the effectiveness of the Company's internal control over financial reporting
based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight
Board (United States). Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether effective internal control over financial reporting was maintained in all material
respects. Our audit included obtaining an understanding of internal control over financial reporting, evaluating
management's assessment, testing and evaluating the design and operating effectiveness of internal control,
and performing such other procedures as we considered necessary in the circumstances. We believe that our
audit provides a reasonable basis for our opinion.
A company's internal control over financial reporting is a process designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting principles. A company's internal control
over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records
that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the
company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation
of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and
directors of the company; and (3) provide 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. 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.
A material weakness is a control deficiency, or combination of control deficiencies, that results in a more
than remote likelihood that a material misstatement of the annual or interim financial statements will not be
prevented or detected. The following material weakness related to accounting for income taxes has been
identified and included in management's assessment as of March 31, 2006.
The Company had insufficient personnel resources with adequate expertise to properly manage the
increased volume and complexity of income tax matters associated with the acquisition of Veritas
Software Corporation. This lack of resources resulted in inadequate levels of supervision and review related to
the Company's Internal Revenue Service (IRS) filings and the Company's accounting for income taxes. This
material weakness resulted in the Company's failure to follow established policies and procedures designed to
ensure timely income tax filings. Specifically, the Company did not complete the timely filing of an extension
request with the IRS for the final pre-acquisition income tax return for Veritas and, accordingly, did not
secure certain income tax related elections. In addition, this material weakness resulted in errors in the
Company's annual accounting for income taxes. The aforementioned material weakness results in more than a
remote likelihood that a material misstatement of the Company's annual or interim financial statements due
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