XM Radio 1999 Annual Report Download - page 52

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50 XM RADiO
iNDEPENDENT AUDiTORS’ REPORT
To the Board of Directors and Stockholders
XM Satellite Radio Holdings Inc. and Subsidiaries:
We have audited the accompanying consolidated balance sheets of XM Satellite Radio
Holdings Inc. and subsidiaries (a development stage company) as of December 31, 1998
and 1999, and the related consolidated statements of operations, stockholders’ equity
(deficit), and cash flows for each of the years in the three-year period ended December 31,
1999, and for the period from December 15, 1992 (date of inception) to December 31,
1999. These consolidated financial statements are the responsibility of the Company’s
management. Our responsibility is to express an opinion on these consolidated financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. Those
standards require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all
material respects, the financial position of XM Satellite Radio Holdings Inc. and subsidiaries
(a development stage company) as of December 31, 1998 and 1999, and the results of
their operations and their cash flows for each of the years in the three-year period ended
December 31, 1999 and for the period from December 15, 1992 (date of inception) to
December 31, 1999, in conformity with generally accepted accounting principles.
The accompanying consolidated financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in note 11 to the consolidated
financial statements, the Company has not commenced operations and is dependent upon
additional debt or equity financing, which raises substantial doubt about its ability to
continue as a going concern. Management’s plan in regard to these matters is also
described in note 11. The consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
McLean, VA
February 16, 2000, except
for Note 14, which is
as of March 15, 2000