Western Union 2006 Annual Report Download - page 101

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99
|| Controls and Procedures
Our management, under the supervision and with the
participation of the Principal Executive Officer and Chief
Financial Officer, have evaluated the effectiveness of our
controls and procedures related to our reporting and
disclosure obligations as of December 31, 2006, which is
the end of the period covered by this Annual Report. Based
on that evaluation, and except as described below, the
principal executive officer and chief financial officer have
concluded that the disclosure controls and procedures are
sufficient to provide that (a) material information relating
to us, including our consolidated subsidiaries, is made
known to these officers by our other employees and
employees of our consolidated subsidiaries, particularly
material information related to the period for which this
periodic report is being prepared; and (b) this information
is recorded, processed, summarized, evaluated and
reported, as applicable, within the time periods
specified in the rules and forms of the Securities and
Exchange Commission. We previously identified a material
weakness and restated our financial statements for the
quarters ended March 31, 2006 and June 30, 2006 and
the years ended December 31, 2005, 2004, and 2003
included in our Registration Statement on Form 10, as
amended. Based upon an evaluation of our initial
documentation of hedging arrangements in accordance
with Statement of Financial Accounting Standards No. 133,
“Accounting for Derivative Instruments and Hedging
Activities,” as amended by SFAS No. 138 and SFAS
No. 149 (“SFAS No. 133”), we concluded that our foreign
exchange forward contracts did not qualify for cash flow
hedge accounting since the initial documentation with
respect to these instruments did not meet the requirements
of SFAS No. 133.
Under the direction of our Chief Executive Officer and
our then Co-Principal Financial Officers in September 2006,
we implemented new internal control procedures to improve
the effectiveness of our review over accounting for
derivative financial instruments and to ensure that these
transactions are accounted for in accordance with generally
accepted accounting principles in the United States of
America. These remedial actions include an additional
review by a combination of internal and external personnel
of hedging strategies and related documentation prior to
implementing new or modified strategies, processes or
documentation to ensure hedge accounting is appropriately
applied with respect to SFAS No. 133. In addition, we have
revised and improved the documentation required at the
initiation of a derivative instrument and also during
the required periodic reviews. We will continue to monitor
the effectiveness of these processes, procedures and
controls, and will make any further changes as management
determines appropriate.
Except as described above, there were no changes
that oc c urred dur ing t he f i scal quar ter e nded
December 31, 2006 that have materially affected, or
are reasonably likely to materially affect, our internal
controls over financial reporting.
Controls and Procedures