Wendy's 2008 Annual Report Download - page 181

Management’s Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial
reporting (as defined in Rule 13a-15(f) of the Exchange Act). Our management, with the participation of our
Chief Executive Officer and our Senior Vice President and Chief Financial Officer, carried out an assessment of
the effectiveness of our internal control over financial reporting as of December 28, 2008. The assessment was
performed using the criteria for effective internal control reflected in the Internal Control-Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
Due to the close proximity of the completion of the Wendy’s Merger with management’s evaluation of
the effectiveness of our internal control over financial reporting and our ongoing merger-related integration
activities, we have excluded Wendy’s and its subsidiaries from our assessment of the effectiveness of internal
control over financial reporting as of December 28, 2008. Wendy’s and its subsidiaries accounted for $605,431
(33%) of our $1,822,761 of consolidated 2008 fiscal year revenues, had $30,788 of operating profit within our
$(413,650) of consolidated 2008 fiscal year operating loss and accounted for $3,840,213 (83%) of our
$4,645,620 of consolidated assets as of December 28, 2008. Collectively, the entities comprising Wendy’s are
“significant subsidiaries” (as defined in Regulation S-X under the Exchange Act).
Based on our assessment of the system of internal control, management believes that, as of December 28,
2008, our internal control over financial reporting was effective.
Our independent registered public accounting firm, Deloitte & Touche LLP, has issued an attestation
report dated March 13, 2009, on our internal control over financial reporting.
Changes in Internal Control Over Financial Reporting
On September 29, 2008, we acquired Wendy’s. As part of our integration activities, we have begun to
incorporate our controls and procedures into this recently acquired business. During the fourth quarter of 2008
the financial reporting and income tax accounting processes of Wendy’s were integrated into our accounting
processes. The integrated accounting processes were used for the preparation of financial statements and other
information presented in this Annual Report on Form 10-K. There were no other changes in our internal
control over financial reporting made during our most recent fiscal quarter that materially affected, or are
reasonably likely to materially affect, our internal control over financial reporting. We expect further
integration of Wendy’s processes into our processes in 2009.
Inherent Limitations on Effectiveness of Controls
There are inherent limitations in the effectiveness of any control system, including the potential for
human error and the circumvention or overriding of the controls and procedures. Additionally, judgments in
decision-making can be faulty and breakdowns can occur because of simple error or mistake. An effective
control system can provide only reasonable, not absolute, assurance that the control objectives of the system are
adequately met. Accordingly, our management, including our Chief Executive Officer and our Senior Vice
President and Chief Financial Officer, does not expect that our control system can prevent or detect all error or
fraud. Finally, projections of any evaluation or assessment of effectiveness of a control system to future periods
are subject to the risks that, over time, controls may become inadequate because of changes in an entity’s
operating environment or deterioration in the degree of compliance with policies or procedures.
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WENDY’S/ARBY’S GROUP, INC. AND SUBSIDIARIES
(FORMERLY TRIARC COMPANIES, INC.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED
(In Thousands Except Per Share Amounts)