Cardinal Health 2008 Annual Report Download - page 143

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Item 9: Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
None.
Item 9A: Controls and Procedures
Evaluation of Disclosure Controls and Procedures
The Company carried out an evaluation, as required by Rule 13a-15(e) under the Exchange Act, with the
participation of the Company’s principal executive officer and principal financial officer, of the effectiveness of
the Company’s disclosure controls and procedures as of June 30, 2008. Based on this evaluation, the Company’s
principal executive officer and principal financial officer have concluded that the Company’s disclosure controls
and procedures were effective as of June 30, 2008 to provide reasonable assurance that information required to
be disclosed in the Company’s reports under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the SEC rules and forms and to provide that such information is accumulated
and communicated to management to allow timely decisions regarding required disclosure.
Management’s Report on Internal Control Over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial
reporting as defined in Rule 13a-15(f) under the Exchange Act. The Company’s internal control system is
designed to provide reasonable assurance regarding the preparation and fair presentation of published financial
statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance
with respect to financial statement preparation and presentation. 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 compliance with the policies or procedures may deteriorate or be circumvented.
Management assessed the effectiveness of the Company’s internal control over financial reporting as of
June 30, 2008. In making this assessment, management used the criteria established in Internal Control-
Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the
“COSO criteria”). Based on management’s assessment and the COSO criteria, management believes that the
Company’s internal control over financial reporting was effective as of June 30, 2008 to provide reasonable
assurance regarding the preparation and fair presentation of its published financial statements.
The Company’s independent registered public accounting firm, Ernst & Young LLP, has issued a report on
the Company’s internal control over financial reporting. Ernst & Young LLP’s report appears below under this
Item 9A and expresses unqualified opinions on the effectiveness of the Company’s internal control over financial
reporting.
Changes in Internal Control Over Financial Reporting
During the quarter ended September 30, 2007, the Company began processing selected financial
transactions for its corporate functions and certain businesses within the Clinical Technologies and Services
segment on a newly implemented accounting software system. In April 2008, the Company transitioned selected
financial processes for the remaining business within the Clinical Technologies and Services segment to the new
accounting software system. The Company will transition selected financial processes within its other segments
to the new accounting software system in fiscal 2009. This change of systems is designed to streamline and
integrate the Company’s financial close and reporting processes by reducing the number of platforms used to
record and report financial information, improving efficiency by reducing the amount of manual activity, and
improving the control environment by reducing variability in the financial policies, processes and systems. The
Company has made changes to its internal control over financial reporting in connection with this transition to
the new accounting software system. During the quarter ended September 30, 2007, the Company established
additional temporary compensating controls to support the Company’s internal control over financial reporting
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