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87PepsiCo, Inc. 2009 Annual Report
Management’s Responsibility for Financial Reporting
To Our Shareholders:
At PepsiCo, our actions—the actions of all our associates—are
governed by our Worldwide Code of Conduct. This Code is clearly
aligned with our stated values—a commitment to sustained growth,
through empowered people, operating with responsibility and
building trust. Both the Code and our core values enable us to
operate with integrity—both within the letter and the spirit of the
law. Our Code of Conduct is reinforced consistently at all levels and
in all countries. We have maintained strong governance policies
and practices for many years.
The management of PepsiCo is responsible for the objectivity
and integrity of our consolidated financial statements. The Audit
Committee of the Board of Directors has engaged independent
registered public accounting firm, KPMG LLP, to audit our consoli-
dated financial statements, and they have expressed an unqualified
opinion.
We are committed to providing timely, accurate and under-
standable information to investors. Our commitment encompasses
the following:
Maintaining strong controls over financial reporting. Our
system of internal control is based on the control criteria framework
of the Committee of Sponsoring Organizations of the Treadway
Commission published in their report titled Internal Control—
Integrated Framework. The system is designed to provide reason-
able assurance that transactions are executed as authorized and
accurately recorded; that assets are safeguarded; and that account-
ing records are sufficiently reliable to permit the preparation of
financial statements that conform in all material respects with
accounting principles generally accepted in the U.S. We maintain
disclosure controls and procedures designed to ensure that
information required to be disclosed in reports under the Securities
Exchange Act of 1934 is recorded, processed, summarized and
reported within the specified time periods. We monitor these
internal controls through self-assessments and an ongoing
program of internal audits. Our internal controls are reinforced
through our Worldwide Code of Conduct, which sets forth our
commitment to conduct business with integrity, and within
both the letter and the spirit of the law.
Exerting rigorous oversight of the business. We continuously
review our business results and strategies. This encompasses
financial discipline in our strategic and daily business decisions.
Our Executive Committee is actively involved—from understanding
strategies and alternatives to reviewing key initiatives and financial
performance. The intent is to ensure we remain objective in our
assessments, constructively challenge our approach to potential
business opportunities and issues, and monitor results and controls.
Engaging strong and effective Corporate Governance from
our Board of Directors. We have an active, capable and diligent
Board that meets the required standards for independence, and
we welcome the Board’s oversight as a representative of our
shareholders. Our Audit Committee is comprised of independent
directors with the financial literacy, knowledge and experience to
provide appropriate oversight. We review our critical accounting
policies, financial reporting and internal control matters with them
and encourage their direct communication with KPMG LLP, with
our General Auditor, and with our General Counsel. We also have a
Compliance Department to coordinate our compliance policies
and practices.
Providing investors with financial results that are complete,
transparent and understandable. The consolidated financial
statements and financial information included in this report are the
responsibility of management. This includes preparing the financial
statements in accordance with accounting principles generally
accepted in the U.S., which require estimates based on manage-
ment’s best judgment.
PepsiCo has a strong history of doing what’s right. We realize
that great companies are built on trust, strong ethical standards
and principles. Our financial results are delivered from that culture
of accountability, and we take responsibility for the quality and
accuracy of our financial reporting.
Peter A. Bridgman
Senior Vice President and Controller
Richard Goodman
Chief Financial Officer
Indra K. Nooyi
Chairman of the Board of Directors and Chief Executive Officer
88045_pepsico-09ar_87-92_R1.indd 87 2/24/10 5:11 PM