Hertz 2015 Annual Report Download - page 161

Table of Contents
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None.
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Our senior management has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined under
Exchange Act Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this Annual Report on Form 10-K. Based upon that
evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of December 31, 2015, due to the identification of
material weaknesses in our internal control over financial reporting, as further described below, our disclosure controls and procedures were not
effective to provide reasonable assurance that the information required to be disclosed by us in the reports that we file or submit under the
Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that
such information is accumulated and communicated to management as appropriate to allow timely decisions regarding required disclosure.
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Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange
Act Rules 13a-15(f) and 15d-15(f).
Internal control over financial reporting has inherent limitations. Internal control over financial reporting is a process that involves human diligence
and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internal control over financial reporting also
can be circumvented by collusion or improper management override. Because of such limitations, there is a risk that material misstatements will
not be prevented or detected on a timely basis by internal control over financial reporting. Therefore, it is possible to design into the process
safeguards to reduce, though not eliminate, this risk.
Management, including our Chief Executive Officer and our Chief Financial Officer, assessed the effectiveness of our internal control over financial
reporting as of December 31, 2015. In making this assessment, management used the criteria set forth by the Committee of Sponsoring
Organizations of the Treadway Commission (“COSO”) in Internal Control - Integrated Framework (2013). Based on this assessment, management
has concluded that we did not maintain effective internal control over financial reporting as of December 31, 2015, due to the fact that certain
material weaknesses previously identified in the 2014 Form 10-K filing on July 16, 2015 continue to exist at December 31, 2015, as discussed
below.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable
possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
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We did not maintain an effective control environment primarily attributable to the following identified material weaknesses:
•We did not have a sufficient complement of personnel with an appropriate level of knowledge, experience, and training commensurate with
our financial reporting requirements to ensure proper selection and application of GAAP in certain circumstances.
•We did not design effective controls over the non-fleet procurement process, which was exacerbated by the lack of training of field
personnel as part of our Oracle ERP system implementation during 2013.
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