SanDisk 2008 Annual Report Download - page 62

Market Risk. We also hold available-for-sale equity securities in semiconductor wafer manufacturing
companies. As of December 28, 2008, a reduction in price of 10% of these marketable equity securities would
result in a decrease in the fair value of our investments in marketable equity securities of approximately
$0.2 million.
All of the potential changes noted above are based on sensitivity analysis performed on our financial
position at December 28, 2008. Actual results may differ materially.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this item is set forth beginning at page F-1.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Not applicable.
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures. Under the supervision and with the participation of our
management, including our principal executive officer and principal financial officer, we conducted an
evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined
in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 as of the end of the period covered
by this report (the “Evaluation Date”). Based upon the evaluation, our principal executive officer and principal
financial officer concluded as of the Evaluation Date that our disclosure controls and procedures were effective.
Disclosure controls are controls and procedures designed to reasonably ensure that information required to be
disclosed in our reports filed under the Exchange Act, such as this report, is recorded, processed, summarized and
reported within the time periods specified in the SEC’s rules and forms. Disclosure controls include controls and
procedures designed to reasonably ensure that such information is accumulated and communicated to our
management, including our chief executive officer and chief financial officer, as appropriate to allow timely
decisions regarding required disclosure. Our quarterly evaluation of disclosure controls and procedures includes
an evaluation of some components of our internal control over financial reporting, and internal control over
financial reporting is also separately evaluated on an annual basis for purposes of providing the management
report which is set forth below.
Report of Management on Internal Control Over Financial Reporting. Our management is responsible for
establishing and maintaining a comprehensive system of internal control over financial reporting to provide
reasonable assurance of the proper authorization of transactions, the safeguarding of assets and the reliability of
the financial records. Our internal control system was designed to provide reasonable assurance to our
management and board of directors regarding the preparation and fair presentation of published financial
statements. The system of internal control over financial reporting provides for appropriate division of
responsibility and is documented by written policies and procedures that are communicated to employees. The
framework upon which management relied in evaluating the effectiveness of our internal control over financial
reporting was set forth in Internal Controls — Integrated Framework published by the Committee of Sponsoring
Organizations of the Treadway Commission.
Based on the results of our evaluation, our management concluded that our internal control over financial
reporting was effective as of December 28, 2008.
However, projections of any evaluation of effectiveness to future periods are subject to the risk that controls
may become inadequate because of changes in our business or other conditions, or that the degree of compliance
with our policies or procedures may deteriorate.
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