Fannie Mae 2002 Annual Report Download - page 123

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121
FANNIE MAE 2002 ANNUAL REPORT
To the Board of Directors and Stockholders of Fannie Mae:
We have audited the accompanying balance sheets of Fannie Mae as of December 31, 2002 and 2001, and the related
statements of income, changes in stockholders’ equity, and cash flows for each of the years in the three-year period ended
December 31, 2002. These financial statements are the responsibility of Fannie Mae’s management. Our responsibility is
to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of
Fannie Mae as of December 31, 2002 and 2001, and the results of its operations and its cash flows for each of the years in
the three-year period ended December 31, 2002, in conformity with accounting principles generally accepted in the
United States of America.
As discussed in Note 13 to the financial statements, Fannie Mae changed its method of accounting for derivative instruments
and hedging activities in 2001 in accordance with the adoption of Financial Accounting Standard No. 133, Accounting for
Derivative Instruments and Hedging Activities.
We also have audited in accordance with auditing standards generally accepted in the United States of America the
supplemental fair value balance sheets of Fannie Mae as of December 31, 2002 and 2001, included in Note 16 to the financial
statements. As described in Note 16, the supplemental fair value balance sheets have been prepared by management to present
relevant financial information that is not provided by the financial statements and is not intended to be a presentation in
conformity with accounting principles generally accepted in the United States of America. In addition, the supplemental
fair value balance sheets do not purport to present the net realizable, liquidation, or market value of Fannie Mae as a whole.
Furthermore, amounts ultimately realized by Fannie Mae from the disposal of assets may vary significantly from the fair values
presented. In our opinion, the supplemental fair value balance sheets included in Note 16 present fairly, in all material respects,
the information set forth therein.
Washington, DC
January 14, 2003
Independent Auditors’ Report