LabCorp 2007 Annual Report Download - page 33

Laboratory Corporation of America® Holdings 2007 31
To the Board of Directors and Shareholders of
Laboratory Corporation of America Holdings:
In our opinion, the consolidated balance sheets and the related
consolidated statements of operations, changes in shareholders’
equity, and cash fl ows present fairly, in all material respects, the
fi nancial position of Laboratory Corporation of America Holdings and
its subsidiaries at December 31, 2007 and 2006, and the results of
their operations and their cash fl ows for each of the three years in
the period ended December 31, 2007 in conformity with accounting
principles generally accepted in the United States of America. Also
in our opinion, the Company maintained, in all material respects,
effective internal control over fi nancial reporting as of December 31,
2007, based on criteria established in Internal Control – Integrated
Framework issued by the Committee of Sponsoring Organizations of
the Treadway Commission (COSO). The Company’s management is
responsible for these fi nancial statements, for maintaining effective
internal control over fi nancial reporting and for its assessment of the
effectiveness of internal control over fi nancial reporting, included in
Managements’ Report on Internal Control Over Financial Reporting.
Our responsibility is to express opinions on these fi nancial statements
and on the Company’s internal control over fi nancial reporting based
on our integrated audits. We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board
(United States). Those standards require that we plan and perform the
audits to obtain reasonable assurance about whether the fi nancial
statements are free of material misstatement and whether effective
internal control over fi nancial reporting was maintained in all material
respects. Our audits of the fi nancial statements included examining,
on a test basis, evidence supporting the amounts and disclosures in
the fi nancial statements, assessing the accounting principles used
and signifi cant estimates made by management, and evaluating
the overall fi nancial statement presentation. Our audit of internal
control over fi nancial reporting included obtaining an understanding
of internal control over fi nancial reporting, assessing the risk that a
material weakness exists, and testing and evaluating the design and
operating effectiveness of internal control based on the assessed
risk. Our audits also included performing such other procedures as
we considered necessary in the circumstances. We believe that our
audits provide a reasonable basis for our opinions.
As discussed in Note 14 to the consolidated fi nancial statements,
the Company changed the manner in which it accounts for uncertain
tax positions in 2007.
As discussed in Note 15 to the consolidated fi nancial statements,
the Company changed the manner in which it accounts for share-based
compensation in 2006.
As discussed in Note 17 to the consolidated fi nancial statements,
the Company changed the manner in which it accounts for defi ned
benefi t and other postretirement plans as of December 31, 2006.
A company’s internal control over fi nancial reporting is a process
designed to provide reasonable assurance regarding the reliability of
fi nancial reporting and the preparation of fi nancial statements for external
purposes in accordance with generally accepted accounting principles.
A company’s internal control over fi nancial reporting includes those
policies and procedures that (i) pertain to the maintenance of records
that, in reasonable detail, accurately and fairly refl ect the transactions
and dispositions of the assets of the company; (ii) provide reasonable
assurance that transactions are recorded as necessary to permit
preparation of fi nancial 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 management
and directors of the company; and (iii) 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 fi nancial statements.
Because of its inherent limitations, internal control over fi nancial
reporting may not prevent or detect misstatements. Also, projections
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.
PricewaterhouseCoopers LLP
Greensboro, North Carolina
February 25, 2008
Report of Independent Registered
Public Accounting Firm
Laboratory Corporation of America