Lowe's 2002 Annual Report Download - page 21

MANAGEMENT’S RESPONSIBILITY FO R FINANCIAL REPORTING
Our Annual Report talks about our future, particularly in the “Letter to Shareholders” and “Management’s Discussion and Analysis
of Financial Condition and Results of Operations.” While we believe our expectations are reasonable, we can’t guarantee them and
you should consider this when thinking about statements we make that aren’t historical facts. Some of the things that could cause
our actual results to differ substantially from our expectations are:
*Our sales are dependent upon the general economic health of the country, variations in the number of new housing starts, the
level of repairs, remodeling and additions to existing homes, commercial building activity, and the availability and cost of
financing. An economic downturn can impact sales because much of our inventory is purchased for discretionary projects, which
can be delayed.
*Our expansion strategy may be impacted by environmental regulations, local zoning issues and delays, availability and
development of land, and more stringent land use regulations than we have traditionally experienced as well as the availability of
sufficient labor to facilitate our growth.
*Many of our products are commodities whose prices fluctuate erratically within an economic cycle, a condition true of lumber
and plywood.
*Our business is highly competitive, and as we expand to larger markets, and to the Internet, we may face new forms of
competition which do not exist in some of the markets we have traditionally served.
*The ability to continue our everyday competitive pricing strategy and provide the products that customers want depends on our
vendors providing a reliable supply of inventory at competitive prices.
*On a short-term basis, weather may impact sales of product groups like lawn and garden, lumber, and building materials.
DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
Lowe’s management is responsible for the preparation, integrity and fair presentation of its published financial statements. These
statements have been prepared in accordance with generally accepted accounting principles and, as such, include amounts based
on management’s best estimates and judgments. Lowe’s management also prepared the other information included in the annual
report and is responsible for its accuracy and consistency with the financial statements.
The Company’s financial statements have been audited by the independent accounting firm Deloitte & Touche LLP, which was
given unrestricted access to all financial records and related data. The Company believes that all representations made to the
independent auditors during their audit were valid and appropriate. Deloitte & Touche’s audit report presented here provides an
independent opinion upon the fairness of the financial statements.
The Company maintains a system of internal control over financial reporting, which is designed to provide reasonable
assurance to Lowe’s management and Board of Directors regarding the preparation of reliable published financial statements. The
system includes appropriate divisions of responsibility, established policies and procedures (including a code of conduct to foster a
strong ethical climate) which are communicated throughout the Company, and the careful selection, training and development of
its people. Internal auditors monitor the operation of the internal control system and report findings and recommendations to
management and the Board of Directors, and corrective actions are taken to address control deficiencies and other opportunities
for improving the system as they are identified. The Board, operating through its audit committee, provides oversight to the
financial reporting process.
Robert L. Tillman Robert F. Hull, Jr.
Chairman of the Board and Chief Executive Officer Senior Vice President and Chief Financial Officer