Pfizer 2006 Annual Report Download - page 38

36 2006 Financial Report
The Board of Directors and Shareholders of Pfizer Inc:
We have audited the accompanying consolidated balance sheets
of Pfizer Inc and Subsidiary Companies as of December 31, 2006
and 2005, and the related consolidated statements of income,
shareholders’ equity, and cash flows for each of the years in the
three-year period ended December 31, 2006. These consolidated
financial statements are the responsibility of the Company’s
management. Our responsibility is to express an opinion on these
consolidated financial statements based on our 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 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 significant 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 consolidated financial statements referred to
above present fairly, in all material respects, the financial position
of Pfizer Inc and Subsidiary Companies as of December 31, 2006 and
2005, and the results of their operations and their cash flows for
each of the years in the three-year period ended December 31, 2006,
in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the
Public Company Accounting Oversight Board (United States), the
effectiveness of Pfizer Inc and Subsidiary Companies’ internal
control over financial reporting as of December 31, 2006, based
on criteria established in Internal Control—Integrated Framework
issued by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO), and our report dated February 27,
2007 expressed an unqualified opinion on management’s
assessment of, and the effective operation of, internal control
over financial reporting.
As discussed, in the Notes to the Consolidated Financial
Statements—Note 1. Significant Accounting Policies, effective
January 1, 2006, Pfizer Inc adopted the provisions of Statement of
Financial Accounting Standards No. 123R, Share-Based Payment.
As discussed, in the Notes to the Consolidated Financial
Statements—Note 1. Significant Accounting Policies, effective
December 31, 2006, Pfizer Inc adopted the provisions of Statement
of Financial Accounting Standards No. 158, Employers’ Accounting
for Defined Benefit Pension and Other Postretirement Plans (an
amendment of Financial Accounting Standards Board Statements
No. 87, 88, 106 and 132R).
KPMG LLP
New York, New York
February 27, 2007
The Board of Directors and Shareholders of Pfizer Inc:
We have audited management’s assessment, included in the
accompanying Management’s Report on Internal Control Over
Financial Reporting, that Pfizer Inc and Subsidiary Companies
maintained effective internal control over financial reporting as of
December 31, 2006, based on criteria established in Internal Control—
Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). Pfizer Inc and
Subsidiary Companies’ management is responsible for maintaining
effective internal control over financial reporting and for its assessment
of the effectiveness of internal control over financial reporting. Our
responsibility is to express an opinion on management’s assessment
and an opinion on the effectiveness of the Company’s internal control
over financial reporting based on our audit.
We conducted our audit in accordance with the standards of the
Public Company Accounting Oversight Board (United States).
Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether effective internal
control over financial reporting was maintained in all material
respects. Our audit included obtaining an understanding of
internal control over financial reporting, evaluating management’s
assessment, testing and evaluating the design and operating
effectiveness of internal control, and performing such other
procedures as we considered necessary in the circumstances. We
believe that our audit provides a reasonable basis for our opinion.
A company’s internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted
accounting principles. A company’s internal control over financial
reporting includes those policies and procedures that (i) pertain
to the maintenance of records that, in reasonable detail, accurately
and fairly reflect the transactions and dispositions of the assets
of the company; (ii) provide reasonable assurance that transactions
are recorded as necessary to permit preparation of financial
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 financial statements.
Because of its inherent limitations, internal control over financial
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.
In our opinion, management’s assessment that Pfizer Inc and
Subsidiary Companies maintained effective internal control over
financial reporting as of December 31, 2006, is fairly stated, in all
material respects, based on criteria established in Internal Control—
Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). Also, in our
opinion, Pfizer Inc and Subsidiary Companies maintained, in all
material respects, effective internal control over financial reporting
as of December 31, 2006, based on criteria established in Internal
Control—Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO).
We also have audited, in accordance with the standards of the
Public Company Accounting Oversight Board (United States), the
consolidated balance sheets of Pfizer Inc and Subsidiary Companies
as of December 31, 2006 and 2005, and the related consolidated
statements of income, shareholders’ equity, and cash flows for
each of the years in the three-year period ended December 31,
2006, and our report dated February 27, 2007 expressed an
unqualified opinion on those consolidated financial statements.
KPMG LLP
New York, New York
February 27, 2007
Report of Independent Registered
Public Accounting Firm on the
Consolidated Financial Statements
Report of Independent Registered
Public Accounting Firm on
Internal Control Over Financial Reporting