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Report of Independent Registered
Public Accounting Firm
104 PepsiCo, Inc. 2010 Annual Report
To the Board of Directors and Shareholders of
PepsiCo, Inc.:
We have audited the accompanying Consolidated Balance
Sheets of PepsiCo, Inc. and subsidiaries (“PepsiCo, Inc.” or “the
Company”) as of December25, 2010 and December 26, 2009, and
the related Consolidated Statements of Income, Cash Flows and
Equity for each of the fiscal years in the three-year period ended
December25, 2010. We also have audited PepsiCo, Inc.’s internal
control over financial reporting as of December25, 2010, 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 financial statements, for
maintaining eective internal control over financial reporting,
and for its assessment of the eectiveness of internal control over
financial reporting, included in the accompanying Management’s
Report on Internal Control over Financial Reporting. Our respon-
sibility is to express an opinion on these consolidated financial
statements and an opinion on the Company’s internal control over
financial 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 financial state-
ments are free of material misstatement and whether eective
internal control over financial reporting was maintained in all
material respects. Our audits of the consolidated financial state-
ments included examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assess-
ing the accounting principles used and significant estimates made
by management, and evaluating the overall financial statement
presentation. Our audit of internal control over financial report-
ing included obtaining an understanding of internal control over
financial reporting, assessing the risk that a material weakness
exists, and testing and evaluating the design and operating eec-
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 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 accordance with generally
accepted accounting principles. A company’s internal control
over financial reporting includes those policies and procedures
that (1)pertain to the maintenance of records that, in reason-
able detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (2)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 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 eect on the finan-
cial statements.
Because of its inherent limitations, internal control over finan-
cial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of eectiveness to future periods
are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compli-
ance with the policies or procedures may deteriorate.
In our opinion, the consolidated financial statements referred
to above present fairly, in all material respects, the financial posi-
tion of PepsiCo, Inc. as of December25, 2010 and December 26,
2009, and the results of its operations and its cash flows for each
of the fiscal years in the three-year period ended December25,
2010, in conformity with U.S. generally accepted accounting
principles. Also in our opinion, PepsiCo, Inc. maintained, in
all material respects, eective internal control over financial
reporting as of December25, 2010, based on criteria established
in Internal Control — Integrated Framework issued by COSO.
New York, New York
February 18, 2011