Safeway 2013 Annual Report Download - page 42

Table of Contents
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We have audited the accompanying consolidated balance sheets of Safeway Inc. and subsidiaries (the "Company") as of
December 28, 2013 and December 29, 2012, and the related consolidated statements of income, comprehensive income,
stockholders' equity, and cash flows for each of the three years in the period ended December 28, 2013. We also have
audited the Company's internal control over financial reporting as of December 28, 2013, based on criteria established in
Internal Control - Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway
Commission. As described in “Management’s Annual Report on Internal Control over Financial Reporting”, Management’s
assessment of and conclusion on the effectiveness of internal control over financial reporting as of December 28, 2013 did not
include the internal controls of Retalio AG and Intelispend, both acquired by the Company’s consolidated subsidiary,
Blackhawk, in November 2013. The financial statements of Retailo AG and Intelispend constitute less than 1% of net and total
assets, and comprise in aggregate less than 1% of revenues and of net income of Safeway Inc.’s consolidated financial
statement amounts as of and for the year ended December 28, 2013. Accordingly, our audit did not include the internal control
over financial reporting at Retailo AG and InteliSpend. The Company's management is responsible for the consolidated
financial statements of Safeway Inc., for maintaining effective internal control over financial reporting, and for its assessment of
the effectiveness of internal control over financial reporting, included in the accompanying “Management’s Annual Report on
Internal Control over Financial Reporting.” Our responsibility is to express an opinion on these consolidated financial
statements and an opinion on the Company's internal control over financial reporting 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 and whether effective internal control over financial reporting was
maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant
estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over
financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a
material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the
assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances.
We believe that our audits provide a reasonable basis for our opinions.
A company's internal control over financial reporting is a process designed by, or under the supervision of, the company's
principal executive and principal financial officers, or persons performing similar functions, and effected by the company's
board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with generally accepted
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