Chevron 2004 Annual Report Download - page 50
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Please find page 50 of the 2004 Chevron annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.48 CHEVRONTEXACO CORPORATION 2004 ANNUAL REPORT
TotheStockholdersandtheBoardofDirectorsofChevronTexacoCorporation:
WehavecompletedanintegratedauditofChevronTexacoCorporation’s2004consolidatedfinancialstatementsandofitsinternalcontrol
overfinancialreportingasofDecember31,2004,andauditsofits2003and2002consolidatedfinancialstatementsinaccordancewiththe
standardsofthePublicCompanyAccountingOversightBoard(UnitedStates).Ouropinions,basedonouraudits,arepresentedbelow.
Inouropinion,theaccompanyingconsolidatedbalancesheetsandtherelatedconsolidatedstatementsofincome,comprehensiveincome,
stockholders’equityandcashflowspresentfairly,inallmaterialrespects,thefinancialpositionofChevronTexacoCorporationandits
subsidiariesatDecember31,2004and2003,andtheresultsoftheiroperationsandtheircashflowsforeachofthethreeyearsintheperiod
endedDecember31,2004,inconformitywithaccountingprinciplesgenerallyacceptedintheUnitedStatesofAmerica.Thesefinancial
statementsaretheresponsibilityoftheCompany’smanagement.Ourresponsibilityistoexpressanopiniononthesefinancialstatements
basedonouraudits.WeconductedourauditsofthesestatementsinaccordancewiththestandardsofthePublicCompanyAccounting
OversightBoard(UnitedStates).Thosestandardsrequirethatweplanandperformtheaudittoobtainreasonableassuranceaboutwhether
thefinancialstatementsarefreeofmaterialmisstatement.Anauditoffinancialstatementsincludesexamining,onatestbasis,evidence
supportingtheamountsanddisclosuresinthefinancialstatements,assessingtheaccountingprinciplesusedandsignificantestimates
madebymanagement,andevaluatingtheoverallfinancialstatementpresentation.Webelievethatourauditsprovideareasonablebasis
forouropinion.
Also,inouropinion,management’sassessment,includedintheaccompanyingManagement’sReportonInternalControlOverFinancial
Reporting,thattheCompanymaintainedeffectiveinternalcontroloverfinancialreportingasofDecember31,2004,basedoncriteria
establishedinInternalControl–IntegratedFrameworkissuedbytheCommitteeofSponsoringOrganizationsoftheTreadwayCommis-
sion(COSO),isfairlystated,inallmaterialrespects,basedonthosecriteria.Furthermore,inouropinion,theCompanymaintained,in
allmaterialrespects,effectiveinternalcontroloverfinancialreportingasofDecember31,2004,basedoncriteriaestablishedinInternal
Control–IntegratedFrameworkissuedbytheCOSO.TheCompany’smanagementisresponsibleformaintainingeffectiveinternalcon-
troloverfinancialreportingandforitsassessmentoftheeffectivenessofinternalcontroloverfinancialreporting.Ourresponsibilityisto
expressopinionsonmanagement’sassessmentandontheeffectivenessoftheCompany’sinternalcontroloverfinancialreportingbased
onouraudit.WeconductedourauditofinternalcontroloverfinancialreportinginaccordancewiththestandardsofthePublicCompany
AccountingOversightBoard(UnitedStates).Thosestandardsrequirethatweplanandperformtheaudittoobtainreasonableassurance
aboutwhethereffectiveinternalcontroloverfinancialreportingwasmaintainedinallmaterialrespects.Anauditofinternalcontrolover
financialreportingincludesobtaininganunderstandingofinternalcontroloverfinancialreporting,evaluatingmanagement’sassessment,
testingandevaluatingthedesignandoperatingeffectivenessofinternalcontrol,andperformingsuchotherproceduresasweconsidernec-
essaryinthecircumstances.Webelievethatourauditprovidesareasonablebasisforouropinions.
Acompany’sinternalcontroloverfinancialreportingisaprocessdesignedtoprovidereasonableassuranceregardingthereliability
offinancialreportingandthepreparationoffinancialstatementsforexternalpurposesinaccordancewithgenerallyacceptedaccounting
principles.Acompany’sinternalcontroloverfinancialreportingincludesthosepoliciesandproceduresthat(i)pertaintothemaintenance
ofrecordsthat,inreasonabledetail,accuratelyandfairlyreflectthetransactionsanddispositionsoftheassetsofthecompany;(ii)provide
reasonableassurancethattransactionsarerecordedasnecessarytopermitpreparationoffinancialstatementsinaccordancewithgenerally
acceptedaccountingprinciples,andthatreceiptsandexpendituresofthecompanyarebeingmadeonlyinaccordancewithauthorizations
ofmanagementanddirectorsofthecompany;and(iii)providereasonableassuranceregardingpreventionortimelydetectionofunauthor-
izedacquisition,use,ordispositionofthecompany’sassetsthatcouldhaveamaterialeffectonthefinancialstatements.
Becauseofitsinherentlimitations,internalcontroloverfinancialreportingmaynotpreventordetectmisstatements.Also,projec-
tionsofanyevaluationofeffectivenesstofutureperiodsaresubjecttotheriskthatcontrolsmaybecomeinadequatebecauseofchangesin
conditions,orthatthedegreeofcompliancewiththepoliciesorproceduresmaydeteriorate.
AsdiscussedinNote25onpage77tothefinancialstatements,theCompanychangeditsmethodofaccountingforassetretirementobliga-
tionsasofJanuary1,2003.
SanFrancisco,California
March2,2005