The accompanying consolidated financial statements
of Royal Bank of Canada were prepared by management, which is
responsible for the integrity and fairness of the information
presented, including the many amounts that must of necessity
be based on estimates and judgments. These consolidated financial
statements were prepared in accordance with Canadian generally
accepted accounting principles pursuant to Subsection 308 of
the Bank Act (Canada), which states that, except as otherwise
specified by the Superintendent of Financial Institutions Canada,
the financial statements are to be prepared in accordance with
Canadian generally accepted accounting principles. Financial
information appearing throughout this Annual Report is consistent
with these consolidated financial statements. Management has
also prepared consolidated financial statements for Royal Bank
of Canada in accordance with United States generally accepted
accounting principles, and these consolidated financial statements
have also been provided to shareholders.
In discharging its responsibility for the integrity and fairness
of the consolidated financial statements and for the accounting
systems from which they are derived, management maintains the
of internal controls designed to ensure that transactions are
authorized, assets are safeguarded and proper records are maintained.
These controls include quality standards in hiring and training
of employees, policies and procedures manuals, a corporate code
of conduct and accountability for performance within appropriate
and well-defined areas of responsibility.
The system of internal controls is further supported by a compliance
function, which is designed to ensure that we and our employees
comply with securities legislation and conflict of interest rules,
and by an internal audit staff, which conducts periodic audits
of all aspects of our operations.
The Board of Directors oversees management’s responsibilities
for financial reporting through an Audit Committee, which is composed
entirely of directors who are neither officers nor employees of
the bank. This Committee reviews the consolidated financial statements
of the bank and recommends them to the board for approval. Other
key responsibilities of the Audit Committee include reviewing our
existing internal control procedures and planned revisions to those
procedures, and advising the directors on auditing matters and
financial reporting issues. Our Compliance Officer and Chief Internal
Auditor have full and unrestricted access to the Audit Committee.
At least once a year, the Superintendent of Financial Institutions
Canada makes such examination and enquiry into the affairs of
the bank as deemed necessary to ensure that the provisions of
the Bank Act (Canada), having reference to the safety of the
depositors and shareholders of the bank, are being duly observed
and that the bank is in sound financial condition.
Deloitte & Touche LLP, independent auditors appointed by the
shareholders of the bank upon the recommendation of the Audit Committee,
have performed an independent audit of the consolidated financial
statements and their report follows. The shareholders’ auditors
have full and unrestricted access to the Audit Committee to discuss
their audit and related findings.
Gordon M. Nixon
President and Chief Executive Officer
Janice R. Fukakusa
Chief Financial Officer
Toronto, December 20, 2004