Yahoo 2008 Annual Report Download - page 118

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Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
The Company’s management, with the participation of the Company’s principal executive officer and principal
financial officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such
term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by
this report. Based on such evaluation, the Company’s principal executive officer and principal financial officer
have concluded that, as of the end of such period, the Company’s disclosure controls and procedures were
effective.
Management’s Report on Internal Control Over Financial Reporting
The Company’s management is responsible for establishing and maintaining adequate internal control over
financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Under the supervision
and with the participation of the Company’s management, including its principal executive officer and principal
financial officer, the Company conducted an evaluation of the effectiveness of its internal control over financial
reporting based on criteria established in the framework in Internal Control — Integrated Framework issued by
the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, the
Company’s management concluded that its internal control over financial reporting was effective as of
December 31, 2008.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect all
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that
controls may become inadequate because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
The Company’s independent registered public accounting firm has issued an attestation report regarding its
assessment of the Company’s internal control over financial reporting as of December 31, 2008, which appears
on page 55.
Changes in Internal Control Over Financial Reporting
There have not been any changes in the Company’s internal control over financial reporting (as such term is
defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the most recent fiscal quarter that have
materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial
reporting.
Item 9B. Other Information
Adoption of Executive Incentive Plan
On February 25, 2009, the Compensation Committee approved a new annual cash bonus plan for senior
executives of the Company, the Yahoo! Executive Incentive Plan (the “EIP”). Each participant in the EIP is
assigned a target bonus percentage each year that is expressed as a percentage of the participant’s annual base
salary. The aggregate bonus pool available under the EIP for a particular year will equal the aggregate amount of
the participants’ target bonus opportunities, multiplied by a factor (the “Funding Percentage”) that may range
from 50 percent to 200 percent based on Yahoo!’s operating cash flow (as defined in the EIP) results for that year
as a percentage of an operating cash flow target set by the Compensation Committee for the year. An individual
participant’s bonus will be based 70 percent on Company performance and 30 percent based on individual
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