Philips 2006 Annual Report Download - page 217

Philips Annual Report 2006 217
6060
To the Supervisory Board and Shareholders of Koninklijke Philips
Electronics N.V.:
Report on the consolidated fi nancial statements
We have audited the accompanying consolidated fi nancial statements
2006 which are part of the fi nancial statements of Koninklijke Philips
Electronics N.V., Eindhoven, The Netherlands which comprise the
consolidated balance sheet as at December 31, 2006, statement of
income, statement of changes in equity and cash fl ow statement for
the year then ended, and a summary of signifi cant accounting policies
and other explanatory notes as set out on page 174 to 216.
Management’s responsibility
The Board of Management is responsible for the preparation and fair
presentation of the consolidated fi nancial statements in accordance
with International Financial Reporting Standards as adopted by the
European Union and with Part 9 of Book 2 of the Netherlands Civil
Code, and for the preparation of the Management commentary in
accordance with Part 9 of Book 2 of the Netherlands Civil Code.
This responsibility includes: designing, implementing and maintaining
internal control relevant to the preparation and fair presentation
of the consolidated fi nancial statements that are free from material
misstatement, whether due to fraud or error; selecting and applying
appropriate accounting policies; and making accounting estimates
that are reasonable in the circumstances.
Auditor’s responsibility
Our responsibility is to express an opinion on the consolidated
fi nancial statements based on our audit. We conducted our audit in
accordance with Dutch law. This law requires that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance whether the consolidated fi nancial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence
about the amounts and disclosures in the consolidated fi nancial
statements. The procedures selected depend on the auditor’s judgment,
including the assessment of the risks of material misstatement of the
consolidated fi nancial statements, whether due to fraud or error. In
making those risk assessments, the auditor considers internal control
relevant to the entity’s preparation and fair presentation of the
consolidated fi nancial statements in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose
of expressing an opinion on the effectiveness of the entity’s internal
control. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates
made by management, as well as evaluating the overall presentation
of the consolidated fi nancial statements.
We believe that the audit evidence we have obtained is suffi cient
and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated fi nancial statements give a true and
fair view of the fi nancial position of Koninklijke Philips Electronics N.V.
as at December 31, 2006, and of its result and its cash fl ows for the
year then ended in accordance with International Financial Reporting
Standards as adopted by the European Union and with Part 9 of Book
2 of the Netherlands Civil Code.
Report on other legal and regulatory requirements
Pursuant to the legal requirement under 2:393 sub 5 part e of the
Netherlands Civil Code, we report, to the extent of our competence,
that the Management commentary as set out on page 172 to 173 is
consistent with the consolidated fi nancial statements as required by
2:391 sub 4 of the Netherlands Civil Code.
Amstelveen, February 19, 2007
KPMG Accountants N.V.
A.M. van Drunen Littel RA
Auditors’ report
226 Corporate governance224 Reconciliation of
non-US GAAP information
234 The Philips Group
in the last ten years
236 Investor information