Walgreens 2006 Annual Report Download - page 35

Report of Independent Registered
Public Accounting Firm
To the Board of Directors and Shareholders of Walgreen Co.:
We have audited management’s assessment, included in the accompanying
Management’s Report on Internal Control, that Walgreen Co. and Subsidiaries
(the “Company”) maintained effective internal control over financial reporting as
of August 31, 2006, based on criteria established in Internal Control – Integrated
Framework
issued by the Committee of Sponsoring Organizations of the Treadway
Commission. The Company’s management is responsible 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
opinion on management’s assessment and an opinion on the effectiveness of
the Company’s internal control over financial reporting based on our audit.
We conducted our audit 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 effective
internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial
reporting, evaluating management’s assessment, testing and evaluating the
design and operating effectiveness of internal control, and performing such other
procedures as we considered necessary in the circumstances. We believe that
our audit provides 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
accounting principles. 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 generally accepted accounting principles, 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 statements.
Because of the inherent limitations of internal control over financial reporting,
including the possibility of collusion or improper management override of controls,
material misstatements due to error or fraud may not be prevented or detected on
a timely basis. Also, projections of any evaluation of the effectiveness of the internal
control over financial reporting to future periods are subject to the risk that the
controls may become inadequate because of changes in conditions, or that the
degree of compliance with the policies or procedures may deteriorate.
In our opinion, management’s assessment that the Company maintained effective
internal control over financial reporting as of August 31, 2006, is fairly stated, in all
material respects, based on the criteria established in
Internal Control—Integrated
Framework
issued by the Committee of Sponsoring Organizations of the Treadway
Commission. Also in our opinion, the Company maintained, in all material respects,
effective internal control over financial reporting as of August 31, 2006, based on
the criteria established in Internal Control – Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission.
We have also audited, in accordance with the standards of the Public Company
Accounting Oversight Board (United States), the consolidated financial statements
as of and for the year ended August 31, 2006 of the Company and our report dated
October 31, 2006 expressed an unqualified opinion on those financial statements
and included an explanatory paragraph relating to the Company’s change effective
September 1, 2005, in its method of accounting for share-based payments.
DELOITTE & TOUCHE LLP
Chicago, Illinois
October 31, 2006
2006 Walgreens Annual Report Page 33