JP Morgan Chase 2006 Annual Report Download - page 91

JPMorgan Chase & Co. / 2006 Annual Report 89
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 consolidat-
ed financial statements and of its internal control over financial reporting as
of December 31, 2006, in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Our opinions, based on
our audits, are presented below.
Consolidated financial statements
In our opinion, the accompanying consolidated balance sheets and the relat-
ed consolidated statements of income, changes in stockholders' equity and
comprehensive income, and cash flows present fairly, in all material respects,
the financial position of JPMorgan Chase & Co. and its subsidiaries (the
"Company") at December 31, 2006 and 2005, and the results of their opera-
tions and their cash flows for each of the three years in the period ended
December 31, 2006 in conformity with accounting principles generally accept-
ed in the United States of America. These financial statements are the respon-
sibility 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 manage-
ment, 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 accompany-
ing "Management's report on internal control over financial reporting", that
the Company maintained effective internal control over financial reporting as
of December 31, 2006 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 main-
tained, in all material respects, effective internal control over financial report-
ing as of December 31, 2006, 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 finan-
cial reporting based on our audit. We conducted our audit of internal control
over financial reporting in accordance with the standards of the Public
PRICEWATERHOUSECOOPERS LLP • 300 MADISON AVENUE • NEW YORK, NY 10017
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 main-
tained in all material respects. An audit of internal control over financial
reporting includes obtaining an understanding of internal control over finan-
cial 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 21, 2007
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
JPMorgan Chase & Co.