American Express 2004 Annual Report Download - page 77

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Management’s Report on Internal
Control over Financial Reporting
The management of American Express Company (the
Company) is responsible for establishing and maintain-
ing adequate internal control over financial reporting.
The Company’s internal control over financial report-
ing is a process designed to provide reasonable assur-
ance regarding the reliability of financial reporting and
the preparation of financial statements for external
purposes in accordance with generally accepted
accounting principles, and includes those policies and
procedures that:
©Pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the
Company;
©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 expenditures of the Company are being made
only in accordance with authorizations of manage-
ment and directors of the Company; and
©Provide reasonable assurance regarding prevention
or timely detection of unauthorized acquisition, use
or disposition of the Company’s assets that could
have a material effect on the financial statements.
Because of its inherent limitations, internal control over
financial reporting may not prevent or detect misstate-
ments. Also, projections of any evaluation of effective-
ness to future periods are subject to the risk that con-
trols may become inadequate because of changes in
conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
The Company’s management assessed the effective-
ness of the Company’s internal control over financial
reporting as of December 31, 2004. In making this
assessment, the Company’s management used the cri-
teria set forth by the Committee of Sponsoring Organi-
zations of the Treadway Commission (COSO) in Inter-
nal Control-Integrated Framework.
Based on management’s assessment and those criteria,
we believe that, as of December 31, 2004, the Compa-
ny’s internal control over financial reporting is effective.
Ernst & Young LLP (E&Y), the Company’s independent
registered public accounting firm, has issued an audit
report appearing on the following page on our
assessment of the Company’s internal control over
financial reporting.
AXP
AR.04
75
Management’s Report on
Internal Control Over Financial Reporting