US Bank 2006 Annual Report Download - page 63

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Report of Management
Responsibility for the financial statements and other information presented throughout the Annual Report on Form 10-K rests
with the management of U.S. Bancorp. The Company believes that the consolidated financial statements have been prepared in
conformity with accounting principles generally accepted in the United States and present the substance of transactions based
on the circumstances and management’s best estimates and judgment.
In meeting its responsibilities for the reliability of the financial statements, management is responsible for establishing and
maintaining an adequate system of internal control over financial reporting as defined by Rules 13a-15(f) and 15d-15(f) under
the Securities Exchange Act of 1934. The Company’s system of internal controls is designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of publicly filed financial statements in accordance with
accounting principles generally accepted in the United States.
To test compliance, the Company carries out an extensive audit program. This program includes a review for compliance with
written policies and procedures and a comprehensive review of the adequacy and effectiveness of the internal control system.
Although control procedures are designed and tested, it must be recognized that there are limits inherent in all systems of
internal control and, therefore, errors and irregularities may nevertheless occur. Also, estimates and judgments are required to
assess and balance the relative cost and expected benefits of the controls. Projection 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.
The Board of Directors of the Company has an Audit Committee composed of directors who are independent of
U.S. Bancorp. The committee meets periodically with management, the internal auditors and the independent accountants to
consider audit results and to discuss internal accounting control, auditing and financial reporting matters.
Management assessed the effectiveness of the Company’s internal controls over financial reporting as of December 31, 2006.
In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the
Treadway Commission in its Internal Control-Integrated Framework. Based on our assessment and those criteria, management
believes that the Company designed and maintained effective internal control over financial reporting as of December 31,
2006.
The Company’s independent accountants, Ernst & Young LLP, have been engaged to render an independent professional
opinion on the financial statements and issue an attestation report on management’s assessment of the Company’s system of
internal control over financial reporting. Their opinion on the financial statements appearing on page 62 and their attestation
on the system of internal controls over financial reporting appearing on page 63 are based on procedures conducted in
accordance with auditing standards of the Public Company Accounting Oversight Board (United States).
U.S. BANCORP 61