Lowe's 2013 Annual Report Download - page 37

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29
Item 8 - Financial Statements and Supplementary Data
MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Management of Lowe’s Companies, Inc. and its subsidiaries is responsible for establishing and maintaining adequate internal
control over financial reporting (Internal Control) as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as
amended. Our Internal Control was designed to provide reasonable assurance to our management and the Board of Directors
regarding the reliability of financial reporting and the preparation and fair presentation of published financial statements.
All internal control systems, no matter how well designed, have inherent limitations, including the possibility of human error
and the circumvention or overriding of controls. Therefore, even those systems determined to be effective can provide only
reasonable assurance with respect to the reliability of financial reporting and financial statement preparation and
presentation. Further, because of changes in conditions, the effectiveness may vary over time.
Our management, with the participation of the Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness
of our Internal Control as of January 31, 2014. In evaluating our Internal Control, we used the criteria set forth by the
Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework
(1992). Based on our management’s assessment, we have concluded that, as of January 31, 2014, our Internal Control is
effective.
Under guidelines established by the SEC, companies are permitted to exclude acquisitions from their first assessment of
internal control over financial reporting following the date of acquisition. Management’s assessment of the effectiveness of the
Company’s internal control over financial reporting excluded Orchard Supply Company, LLC, a wholly owned subsidiary of
Lowe's Companies Inc. that consists of the net assets purchased from Orchard Supply Hardware Stores Corporation in August
2013. Orchard represented 1.4% and 0.4% of the Company’s consolidated total assets and consolidated net sales, respectively,
as of and for the year ended January 31, 2014. This acquisition is more fully discussed in Note 5 to our Consolidated Financial
Statements for fiscal year 2013.
Deloitte & Touche LLP, the independent registered public accounting firm that audited the financial statements contained in
this report, was engaged to audit our Internal Control. Their report appears on page 31.