McDonalds 2000 Annual Report Download - page 49

Report of independent auditors
The Board of Directors and Shareholders
McDonald’s Corporation
We have audited the accompanying consolidated balance sheet of
McDonald’s Corporation as of December 31, 2000 and 1999, and
the related consolidated statements of income, shareholders’ equity
and cash flows for each of the three years in the period ended
December 31, 2000. These financial statements are the responsibility
of McDonald’s Corporation management. Our responsibility is to
express an opinion on these financial statements based on our
audits.
We conducted our audits in accordance with auditing standards
generally accepted in the U.S. Those standards require that we plan
and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and signifi-
cant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the consolidated financial position of
McDonald’s Corporation at December 31, 2000 and 1999, and the
consolidated results of its operations and its cash flows for each of
the three years in the period ended December 31, 2000, in confor-
mity with accounting principles generally accepted in the U.S.
ERNST & YOUNG LLP
Chicago, Illinois
January 24, 2001
Financial review 47
Management’s report
Management is responsible for the preparation, integrity and fair pre-
sentation of the consolidated financial statements and financial com-
ments appearing in this annual report. The financial statements were
prepared in accordance with accounting principles generally accepted
in the U.S. and include certain amounts based on management’s
judgment and best estimates. Other financial information presented
in the annual report is consistent with the financial statements.
The Company maintains a system of internal controls over finan-
cial reporting, including safeguarding of assets against unauthorized
acquisition, use or disposition, which is designed to provide reason-
able assurance to the Company’s management and Board of
Directors regarding the preparation of reliable published financial
statements and asset safeguarding. The system includes a docu-
mented organizational structure and appropriate division of responsi-
bilities; established policies and procedures that are communicated
throughout the Company; careful selection, training and develop-
ment of our people; and utilization of an internal audit program.
Policies and procedures prescribe that the Company and all employ-
ees are to maintain high standards of proper business practices
throughout the world.
There are inherent limitations in the effectiveness of any system of
internal control, including the possibility of human error and the cir-
cumvention or overriding of controls. Accordingly, even an effective
internal control system can provide only reasonable assurance with
respect to financial statement preparation and safeguarding of
assets. Furthermore, the effectiveness of an internal control system
can change with circumstances. The Company believes that it main-
tains an effective system of internal control over financial reporting
and safeguarding of assets against unauthorized acquisition, use or
disposition.
The consolidated financial statements have been audited by
independent auditors, Ernst & Young LLP, who were given unre-
stricted access to all financial records and related data. The audit
report of Ernst & Young LLP is presented herein.
The Board of Directors, operating through its Audit Committee
composed entirely of independent Directors, provides oversight to
the financial reporting process. Ernst & Young LLP has unrestricted
access to the Audit Committee and periodically meets with the
Committee to discuss accounting, auditing and financial reporting
matters.
McDONALD’S CORPORATION
January 24, 2001