Proctor and Gamble 2007 Annual Report Download - page 31

The Procter & Gamble Company 29
each of the three years in the period ended June 30, 2007, in
conformity with accounting principles generally accepted in the
United States of America.
As discussed in Note 1 to the Consolidated Financial Statements, the
Company adopted the provisions of SFAS No. 158, “Employers’
Accounting for Dened Benet Pension and Other Postretirement Plans,
an amendment of FASB Statements No. 87, 88, 106, and 132(R),”
effective June 30, 2007.
We have also audited, in accordance with the standards of the Public
Company Accounting Oversight Board (United States), the effectiveness
of the Company’s internal control over nancial reporting as of June 30,
2007, based on the criteria established in Internal Control — Integrated
Framework issued by the Committee of Sponsoring Organizations
of the Treadway Commission and our report dated August 14, 2007,
expressed an unqualied opinion on management’s assessment of
the effectiveness of the Company’s internal control over nancial
reporting and an unqualied opinion on the effectiveness of the
Company’s internal control over nancial reporting.
Management assessed the effectiveness of the Company’s internal
control over nancial reporting as of June 30, 2007, using criteria
established in Internal Control — Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission
(COSO) and concluded that the Company maintained effective
internal control over nancial reporting as of June 30, 2007, based
on these criteria.
Deloitte & Touche LLP, an independent registered public accounting rm,
has audited the effectiveness of the Company’s internal control over
nancial reporting and management’s assessment of the effectiveness
of the Company’s internal control over nancial reporting as of June 30,
2007, as stated in their report which is included herein.
Management is responsible for establishing and maintaining adequate
internal control over nancial reporting of The Procter & Gamble
Company (as dened in Rule 13a-15(f) under the Securities Exchange
Act of 1934, as amended). Our internal control over nancial reporting
is designed to provide reasonable assurance regarding the reliability
of nancial reporting and the preparation of nancial statements for
external purposes in accordance with generally accepted accounting
principles in the United States of America.
Strong internal controls is an objective that is reinforced through our
Worldwide Business Conduct Manual, which sets forth our commitment
to conduct business with integrity, and within both the letter and the
spirit of the law. The Company’s internal control over nancial reporting
includes a Control Self-Assessment Program that is conducted annually
by substantially all areas of the Company and is audited by the internal
audit function. Management takes the appropriate action to correct
any identied control deciencies. Because of its inherent limitations,
any system of internal control over nancial reporting, no matter how
well designed, may not prevent or detect misstatements due to the
possibility that a control can be circumvented or overridden or that
misstatements due to error or fraud may occur that are not detected.
Also, because of changes in conditions, internal control effectiveness
may vary over time.
 
Chairman of the Board Vice Chairman and
and Chief Executive Ofcer Chief Financial Ofcer
August 14, 2007

To the Board of Directors and Shareholders of
The Procter & Gamble Company
We have audited the accompanying Consolidated Balance Sheets of
The Procter & Gamble Company and subsidiaries (the “Company”) as
of June 30, 2007 and 2006, and the related Consolidated Statements
of Earnings, Shareholders’ Equity, and Cash Flows for each of the three
years in the period ended June 30, 2007. These nancial statements
are the responsibility of the Company’s management. Our responsibility
is to express an opinion on these nancial 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 nancial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the nancial statements.
An audit also includes assessing the accounting principles used and
signicant estimates made by management, as well as evaluating the
overall nancial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, such Consolidated Financial Statements present fairly,
in all material respects, the nancial position of the Company at June 30,
2007 and 2006, and the results of its operations and cash ows for

Cincinnati, Ohio
August 14, 2007