Walmart 2005 Annual Report Download - page 54

52 WAL-MART 2005 ANNUAL REPORT
Management of Wal-Mart Stores, Inc. (“Wal-Mart”) is responsible
for the preparation, integrity and objectivity of Wal-Mart’s consoli-
dated financial statements and other financial information con-
tained in this Annual Report to Shareholders. Those consolidated
financial statements were prepared in conformity with account-
ing principles generally accepted in the United States. In preparing
those consolidated financial statements, Management was required
to make certain estimates and judgments, which are based upon
currently available information and Management’s view of current
conditions and circumstances.
The Audit Committee of the Board of Directors, which consists
solely of independent directors, oversees our process of reporting
financial information and the audit of our consolidated financial
statements. The Audit Committee stays informed of the finan-
cial condition of Wal-Mart and regularly reviews Management’s
financial policies and procedures, the independence of our inde-
pendent auditors, our internal control and the objectivity of our
financial reporting. Both the independent auditors and the inter-
nal auditors have free access to the Audit Committee and meet
with the Audit Committee periodically, both with and without
Management present.
We have retained Ernst & Young LLP, an independent registered
public accounting firm, to audit our consolidated financial statements
found in this annual report. We have made available to Ernst & Young
LLP all of our financial records and related data in connection with
their audit of our consolidated financial statements.
We have filed with the Securities and Exchange Commission the
required certifications related to our consolidated financial state-
ments as of and for the year ended January 31, 2005. These cer-
tifications are attached as exhibits to our Annual Report on Form
10-K for the year ended January 31, 2005. Additionally, we have
also provided to the New York Stock Exchange the required annual
certification of our Chief Executive Officer regarding our compli-
ance with the New York Stock Exchange’s corporate governance
listing standards.
Report on Internal Control Over Financial Reporting.
Management has responsibility for establishing and maintaining
adequate internal control over financial reporting. 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 reporting purposes
in accordance with accounting principles generally accepted in the
United States. Because of its inherent limitations, internal control
over financial reporting may not prevent or detect misstatements.
Management has assessed the effectiveness of the company’s inter-
nal control over financial reporting as of January 31, 2005. In mak-
ing its assessment, Management has utilized the criteria set forth
by the Committee of Sponsoring Organizations (“COSO”) of the
Treadway Commission in Internal Control – Integrated Framework.
Management concluded that based on its assessment, Wal-Mart’s
internal control over financial reporting was effective as of January
31, 2005. Management’s assessment of the effectiveness of the
company’s internal control over financial reporting as of January 31,
2005 has been audited by Ernst & Young LLP, an independent regis-
tered public accounting firm, as stated in their report which appears
in this Annual Report to Shareholders.
Evaluation of Disclosure Controls and Procedures.
We maintain disclosure controls and procedures designed to
provide reasonable assurance that information, which is required
to be timely disclosed, is accumulated and communicated to
Management in a timely fashion. Management has assessed the
effectiveness of these disclosure controls and procedures as of
January 31, 2005 and determined they were effective as of that
date to provide reasonable assurance that information required
to be disclosed by us in the reports we file or submit under the
Securities Exchange Act of 1934, as amended, is accumulated and
communicated to Management, as appropriate, to allow timely
decisions regarding required disclosure and are effective to provide
reasonable assurance that such information is recorded, processed,
summarized and reported within the time periods specified by the
SEC’s rules and forms.
Report on Ethical Standards.
Our company was founded on the belief that open communica-
tions and the highest standard of ethics are necessary to be suc-
cessful. Our long-standing “Open Door” communication policy
helps Management be aware of and address issues in a timely and
effective manner. Through the open door policy all associates are
encouraged to inform Management at the appropriate level when
they are concerned about any matter pertaining to Wal-Mart.
Wal-Mart has adopted a Statement of Ethics to guide our associ-
ates in the continued observance of high ethical standards such as
honesty, integrity and compliance with the law in the conduct of
Wal-Mart’s business. Familiarity and compliance with the
Statement of Ethics is required of all associates who are part of
Management. The company also maintains a separate Code of
Ethics for our senior financial officers. Wal-Mart also has in place
a Related-Party Transaction Policy. This policy applies to all of
Wal-Mart’s Officers and Directors and requires material related-
party transactions to be reviewed by the Audit Committee. The
Officers and Directors are required to report material related-
party transactions to Wal-Mart. We maintain an ethics office
which oversees and administers an ethics hotline. The ethics
hotline provides a channel for associates to make confidential
and anonymous complaints regarding potential violations of our
statements of ethics, including violations related to financial or
accounting matters.
H. Lee Scott
President and Chief Executive Officer
Thomas M. Schoewe
Executive Vice President and Chief Financial Officer
Management’s Report to Our Shareholders
W A L -M A R T