Pepsi 2013 Annual Report Download - page 129

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Management’s Responsibility for Financial Reporting
To Our Shareholders:
At PepsiCo, our actions – the actions of all our associates – are governed by our Global Code of Conduct.
This Code is clearly aligned with our stated values – a commitment to deliver sustained growth through
empowered people acting 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 consolidated financial statements, and they have expressed an
unqualified opinion.
We are committed to providing timely, accurate and understandable 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 (1992). The system is designed to provide
reasonable assurance that transactions are executed as authorized and accurately recorded; that assets are
safeguarded; and that accounting 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 Global 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 Internal Auditor, and with our General Counsel. We also have a
Compliance & Ethics Department, led by our Chief Compliance & Ethics Officer, 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 management’s best judgment.