Siemens 2005 Annual Report Download - page 215

Consolidated Financial Statements Notes to Consolidated Financial Statements
215
Statement of the Managing Board
Independent auditors’ report
Independent auditors’ report
The Supervisory Board of Siemens AG:
We have audited the accompanying balance sheets of Siemens AG and subsidiaries as of Sep-
tember 30, 2005 and 2004, and the related consolidated statements of income, cash flows and
changes in shareholders’ equity for each of the years then ended. We also have audited manage-
ment’s assessment, included in the report on internal control over financial reporting in this
report, that Siemens AG and subsidiaries maintained effective internal control over financial
reporting as of September 30, 2005, based on criteria established in Internal Control – Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission
(“COSO”). Siemens AG’s management is responsible for these consolidated financial statements,
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 opin-
ion on these consolidated financial statements, an opinion on management’s assessment, and an
opinion on the effectiveness of the Siemens AG’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 audits to
obtain reasonable assurance about whether the financial statements are free of material misstate-
ment and whether effective internal control over financial reporting was maintained in all mate-
rial respects. Our audit of financial statements included examining, on a test basis, evidence sup-
porting 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, evaluating manage-
ment’s assessment, testing and evaluating the design and operating effectiveness of internal con-
trol, and 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 to provide reason-
able assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with accounting principles generally accepted in
the United States of America. A company’s internal control over financial reporting includes those
policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail,
accurately and fairly reflect the transactions and dispositions of the assets of the company; (2)
provide reasonable assurance that transactions are recorded as necessary to permit preparation
of financial statements in accordance with accounting principles generally accepted in the United
States of America, and that receipts and expenditures of the company are being made only in
accordance with authorizations of management and directors of the company; and (3) 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 state-
ments.