JP Morgan Chase 2005 Annual Report Download - page 88

86 JPMorgan Chase & Co. /2005 Annual Report
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders of JPMorgan Chase & Co.:
We have completed integrated audits of JPMorgan Chase & Co.’s 2005 and
2004 consolidated financial statements and of its internal control over
financial reporting as of December 31, 2005, and an audit of its 2003
consolidated financial statements in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Our opinions
on JPMorgan Chase & Co.’s 2005, 2004, and 2003 consolidated financial
statements and on its internal control over financial reporting as of December
31, 2005, based on our audits, are presented below.
Consolidated financial statements
In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of income, changes in stockholders’ equity and cash
flows present fairly, in all material respects, the financial position of the
JPMorgan Chase & Co. and its subsidiaries (the “Company”) at December 31,
2005 and 2004, and the results of their operations and their cash flows for
each of the three years in the period ended December 31, 2005 in conformity
with accounting principles generally accepted in the United States of America.
These financial statements are the responsibility of the Company’s management.
Our responsibility is to express an opinion on these financial statements based
on our audits. We conducted our audits of these statements in accordance
with the standards of the Public Company Accounting Oversight Board
(United States). 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 of financial statements includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
Internal control over financial reporting
Also, in our opinion, management’s assessment, included in the accompanying
Management’s report on internal control over financial reporting, that
the Company maintained effective internal control over financial reporting
as of December 31, 2005 based on criteria established in Internal Control –
Integrated Framework issued by the Committee of Sponsoring Organizations
of the Treadway Commission (COSO), is fairly stated, in all material respects,
based on those criteria. Furthermore, in our opinion, the Company maintained,
in all material respects, effective internal control over financial reporting as of
PRICEWATERHOUSECOOPERS LLP • 300 MADISON AVENUE • NEW YORK, NY 10017
December 31, 2005, based on criteria established in Internal Control –
Integrated Framework issued by the COSO. The Company’s management is
responsible for maintaining effective internal control over financial reporting
and for its assessment of the effectiveness of internal control over financial
reporting. Our responsibility is to express opinions on management’s assess-
ment and on the effectiveness of the Company’s internal control over financial
reporting based on our audit. We conducted our audit of internal control over
financial reporting in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether
effective internal control over financial reporting was maintained in all material
respects. An audit of internal control over financial reporting includes obtaining
an understanding of internal control over financial reporting, evaluating
management’s assessment, testing and evaluating the design and operating
effectiveness of internal control, and performing such other procedures as we
consider necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinions.
A company’s internal control over financial reporting is a process designed
to provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accor-
dance with generally accepted accounting principles. A company’s internal
control over financial reporting includes those policies and procedures that
(i) pertain to the maintenance of records that, in reasonable detail, accurately
and fairly reflect the transactions and dispositions of the assets of the company;
(ii) provide reasonable assurance that transactions are recorded as necessary
to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the
company are being made only in accordance with authorizations of manage-
ment and directors of the company; and (iii) provide reasonable assurance
regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the
financial statements.
Because of its inherent limitations, internal control over financial reporting
may not prevent or detect misstatements. 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 the degree of
compliance with the policies or procedures may deteriorate.
February 24, 2006
Report of independent registered public accounting firm
JPMorgan Chase & Co.