Target 2006 Annual Report Download - page 40

1APR200416064753
1APR200416063806
Item 8. Financial Statements and Supplementary Data.
Report of Management on the Consolidated Financial Statements
Management is responsible for the consistency, integrity and presentation of the information in the Annual Report.
The consolidated financial statements and other information presented in this Annual Report have been prepared in
accordance with accounting principles generally accepted in the United States and include necessary judgments and
estimates by management.
To fulfill our responsibility, we maintain comprehensive systems of internal control designed to provide reasonable
assurance that assets are safeguarded and transactions are executed in accordance with established procedures. The
concept of reasonable assurance is based upon recognition that the cost of the controls should not exceed the benefit
derived. We believe our systems of internal control provide this reasonable assurance.
The Board of Directors exercised its oversight role with respect to the Corporation’s systems of internal control
primarily through its Audit Committee, which is comprised of four independent directors. The Committee oversees the
Corporation’s systems of internal control, accounting practices, financial reporting and audits to assess whether their
quality, integrity and objectivity are sufficient to protect shareholders’ investments.
In addition, our consolidated financial statements have been audited by Ernst & Young LLP, independent registered
public accounting firm, whose report also appears on this page.
Robert J. Ulrich Douglas A. Scovanner
Chairman of the Board and Executive Vice President and
Chief Executive Officer Chief Financial Officer
March 14, 2007
Report of Independent Registered Public Accounting Firm on Consolidated Financial Statements
The Board of Directors and Shareholders
Target Corporation
We have audited the accompanying consolidated statements of financial position of Target Corporation and
subsidiaries (the Corporation) as of February 3, 2007 and January 28, 2006, and the related consolidated statements of
operations, cash flows, and shareholders’ investment for each of the three years in the period ended February 3, 2007.
Our audits also included the financial statement schedule listed in Item 15(a). These financial statements and schedule are
the responsibility of the Corporation’s management. Our responsibility is to express an opinion on these financial
statements and schedule 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 financial statements referred to above present fairly, in all material respects, the consolidated
financial position of Target Corporation and subsidiaries at February 3, 2007 and January 28, 2006, and the
consolidated results of their operations and their cash flows for each of the three years in the period ended February 3,
2007, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial
statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly, in all
material respects, the information set forth therein.
As discussed in Note 28, Pension and Postretirement Health Care Benefits, to the consolidated financial statements,
effective February 3, 2007, the Corporation adopted the recognition and disclosure provisions of SFAS 158, ‘‘Employers’
Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No. 87, 88,
106, and 132(R).’’
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States), the effectiveness of the Corporation’s internal control over financial reporting as of February 3, 2007, based on
criteria established in Internal Control – Integrated Framework, issued by the Committee of Sponsoring Organizations of
the Treadway Commission and our report dated March 14, 2007, expressed an unqualified opinion thereon.
Minneapolis, Minnesota
March 14, 2007
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