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93PepsiCo, Inc. 2008 Annual Report
Report of Independent Registered Public Accounting Firm
The Board of Directors and Shareholders
PepsiCo, Inc.:
We have audited the accompanying Consolidated Balance Sheets
of PepsiCo, Inc. and subsidiaries (“PepsiCo, Inc.” or “the Company”)
as of December 27, 2008 and December 29, 2007, and the
related Consolidated Statements of Income, Cash Flows, and
Common Shareholders’ Equity for each of the scal years in the
three-year period ended December 27, 2008. We also have
audited PepsiCo, Inc.’s internal control over nancial reporting as
of December 27, 2008, based on criteria established in Internal
Control – Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO).
PepsiCo, Inc.’s management is responsible for these consolidated
nancial statements, for maintaining effective internal control over
nancial reporting, and for its assessment of the effectiveness of
internal control over nancial reporting, included in the accompa-
nying Management’s Report on Internal Control over Financial
Reporting. Our responsibility is to express an opinion on these
consolidated nancial statements and an opinion on the Company’s
internal control over nancial reporting based on our audits.
We conducted our audits in accordance with the standards of
the Public Company Accounting Oversight Board (United States).
Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the nancial statements
are free of material misstatement and whether effective internal
control over nancial reporting was maintained in all material
respects. Our audits of the consolidated nancial statements
included examining, on a test basis, evidence supporting the
amounts and disclosures in the nancial statements, assessing
the accounting principles used and signicant estimates made
by management, and evaluating the overall nancial statement
presentation. Our audit of internal control over nancial report-
ing included obtaining an understanding of internal control over
nancial reporting, assessing the risk that a material weakness
exists, and testing and evaluating the design and operating effec-
tiveness of internal control based on the assessed risk. Our audits
also included performing such other procedures as we considered
necessary in the circumstances. We believe that our audits
provide a reasonable basis for our opinions.
A company’s internal control over nancial reporting is a
process designed to provide reasonable assurance regarding the
reliability of nancial reporting and the preparation of nancial
statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control over
nancial reporting includes those policies and procedures that
(1) pertain to the maintenance of records that, in reasonable
detail, accurately and fairly reect the transactions and disposi-
tions of the assets of the company; (2) provide reasonable assur-
ance that transactions are recorded as necessary to permit
preparation of nancial statements in accordance with generally
accepted accounting principles, and that receipts and expendi-
tures of the company are being made only in accordance with
authorizations of management and directors of the company; and
(3) 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
nancial statements.
Because of its inherent limitations, internal control over nan-
cial 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.
In our opinion, the consolidated nancial statements referred
to above present fairly, in all material respects, the nancial posi-
tion of PepsiCo, Inc. as of December 27, 2008 and December 29,
2007, and the results of its operations and its cash ows for each
of the scal years in the three-year period ended December 27,
2008, in conformity with U.S. generally accepted accounting prin-
ciples. Also in our opinion, PepsiCo, Inc. maintained, in all mate-
rial respects, effective internal control over nancial reporting as
of December 27, 2008, based on criteria established in Internal
Control – Integrated Framework issued by COSO.
New York, New York
February 19, 2009