McDonalds 2007 Annual Report Download - page 63

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MANAGEMENT’S ASSESSMENT OF INTERNAL CONTROL OVER FINANCIAL REPORTING
The fi nancial statements were prepared by management, which is responsible for their integrity and objectivity and for establishing
and maintaining adequate internal controls over fi nancial reporting.
The Company’s internal control over fi nancial reporting is 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. The 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.
There are inherent limitations in the effectiveness of any internal control, including the possibility of human error and the circumvention
or overriding of controls. Accordingly, even effective internal controls can provide only reasonable assurances with respect to
fi nancial statement preparation. Further, because of changes in conditions, the effectiveness of internal controls may vary over time.
Management assessed the design and effectiveness of the Company’s internal control over fi nancial reporting as of
December 31, 2007. In making this assessment, management used the criteria set forth by the Committee of Sponsoring
Organizations of the Treadway Commission (“COSO”) in Internal Control – Integrated Framework.
Based on management’s assessment using those criteria, as of December 31, 2007, management believes that the Company’s
internal controls over fi nancial reporting are effective.
Ernst & Young, LLP, independent registered public accounting fi rm, has audited the fi nancial statements of the Company for
the fi scal years ended December 31, 2007, 2006 and 2005 and the Company’s internal control over fi nancial reporting as of
December 31, 2007. Their reports are presented on the following pages. The independent registered public accountants and
internal auditors advise management of the results of their audits, and make recommendations to improve the system of internal
controls. Management evaluates the audit recommendations and takes appropriate action.
McDONALD’S CORPORATION
February 18, 2008
61