United Technologies 2008 Annual Report Download - page 65

Report of Independent Registered Public Accounting Firm
To the Board of Directors and Shareowners of United Technologies Corporation:
In our opinion, the accompanying consolidated balance sheets and the related consolidated
statements of operations, of cash flows and of changes in shareowners’ equity present fairly, in
all material respects, the financial position of United Technologies Corporation and its
subsidiaries at December 31, 2008 and December 31, 2007, and the results of their operations
and their cash flows for each of the three years in the period ended December 31, 2008 in
conformity with accounting principles generally accepted in the United States of America. Also
in our opinion, the Corporation maintained, in all material respects, effective internal control
over financial reporting as of December 31, 2008, based on criteria established in Internal
Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO). The Corporation’s management is responsible for these
financial statements, for maintaining effective internal control over financial reporting and for
its assessment of the effectiveness of internal control over financial reporting included in
accompanying Management’s Report on Internal Control Over Financial Reporting. Our
responsibility is to express opinions on these financial statements and on the Corporation’s
internal control over financial reporting based on our integrated audits. We conducted our
audits in accordance with the standards of the Public Company Accounting Oversight Board
(United States). Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material misstatement
and whether effective internal control over financial reporting was maintained in all material
respects. Our audits of the financial statements included examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing the accounting
principles used and significant estimates made by management, and evaluating the overall
financial statement presentation. Our audit of internal control over financial reporting
included obtaining an understanding of internal control over financial reporting, assessing the
risk that a material weakness exists, and testing and evaluating the design and operating
effectiveness of internal control based on the assessed risk. Our audits also included
performing such other procedures as we considered necessary in the circumstances. We believe
that our audits provide a reasonable basis for our opinions.
As discussed in Note 1 to the consolidated financial statements, the Corporation changed the
manner in which it accounts for defined benefit pension and other postretirement plans in
2006 and 2007 and the manner in which it accounts for uncertain tax positions in 2007. As
discussed in Note 14 to the consolidated financial statements, the Corporation adopted FASB
Statement No. 157, Fair Value Measurements, as of January 1, 2008.
A corporation’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 corporation’s internal control over financial reporting includes those policies and
procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately
and fairly reflect the transactions and dispositions of the assets of the corporation; (ii) 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 corporation are being made only in accordance with
authorizations of management and directors of the corporation; and (iii) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the corporation’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.
Hartford, Connecticut
February 11, 2009
2008 Annual Report 63