Report of the Group Auditors to the General Meeting of
Alcon, Inc.
As group auditors, we have audited the consolidated financial statements (consolidated balance sheets and related consolidated statements of earnings, shareholders' equity and comprehensive income, and cash flows) of Alcon, Inc. and subsidiaries for the year ended December 31, 2002, as included in Item 18 of the Form 20-F of Alcon, Inc. and as included in the Annual Report, and the accompanying Swiss disclosure requirements.
These consolidated financial statements are the responsibility of the board of directors. Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We confirm that we meet the legal requirements concerning professional qualification and independence.
Our audit was conducted in accordance with auditing standards promulgated by the Swiss profession and with auditing standards generally accepted in the United States of America, which require that an audit be planned and performed to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement. We have examined on a test basis evidence supporting the amounts and disclosures in the consolidated financial statements. We have also assessed the accounting principles used, significant estimates made and the overall consolidated financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the consolidated financial statements give a true and fair view of the financial position, the results of operations and the cash flows in accordance with accounting principles generally accepted in the United States of America (US GAAP) and comply with Swiss law.
We recommend that the consolidated financial statements submitted to you be approved.
KPMG Klynveld Peat Marwick Goerdeler SA
Zurich, Switzerland
January 31, 2003
Alcon, Inc. and Subsidiaries
Swiss Disclosure Requirements
(in millions of US dollars)
The consolidated balance sheets of Alcon, Inc. and subsidiaries (the "Company") as of December 31, 2002 and 2001, and the related consolidated statements of earnings, shareholders' equity and comprehensive income, and cash flows for each of the three years in the period ended December 31, 2002 have been prepared in accordance with US Generally Accepted Accounting Principles and are included in Item 18 of the Form 20-F of Alcon, Inc. Swiss law requires additional reporting disclosures and are included in the notes below.
- Significant shareholders
- Investment in subsidiaries
- Fixed assets
- Expense by nature
Nestlé S.A. holds 74.46% of the common shares of Alcon, Inc. The remaining shares are publicly traded on the New York Stock Exchange since March 21, 2002. Alcon, Inc. is not aware of any other significant shareholder holding, directly or indirectly, 5% or more of the common shares.
The following is a list of Alcon, Inc.'s and subsidiaries major investments as of December 31, 2002. The consolidated ownership of each of these investments as of December 31, 2002 is 100%.
Issued | ||||||
Name | Domicile | Activity | share capital | |||
Summit Autonomous, Inc. | Massachusetts, USA | Holding | $ | 0.1 | ||
Autonomous Technologies Corporation | Delaware, USA | Holding | 0.1 | |||
Alcon Holdings Inc. | Delaware, USA | Holding | 0.1 | |||
Alcon Pharmaceuticals, Inc. | Delaware, USA | Distributor | 0.1 | |||
Falcon Pharmaceuticals, Ltd. | Texas, USA | Distributor | 0.1 | |||
Refractive horizons, L.P. | Texas, USA | Distributor | 0.1 | |||
Alcon Laboratories (UK) Ltd. | Herts, UK | Distributor | 4.9 | |||
Alcon Pharmaceuticals Ltd. | Hünenberg, Switzerland | Distributor | 0.1 | |||
Alcon Japan Ltd. | Tokyo, Japan | Distributor | 3.7 | |||
Alcon Laboratories (Australia) Pty. Ltd | Frenchs Forest, Australia | Distributor | 2.0 | |||
Alcon Canada Inc. | Missisauga, Canada | Distributor | 4.3 | |||
Alcon (Puerto Rico) Inc. | Puerto Rico | Distributor | 0.1 | |||
Alcon Hong Kong Ltd. | Hong Kong | Distributor | 0.1 | |||
(2) Investment in subsidiaries (continued) | ||||||
Issued | ||||||
Name | Domicile | Activity | share capital | |||
Alcon Pte Ltd. | Singapore | Distributor | $ | 0.1 | ||
Alcon Italia S.p.A. | Milan, Italy | Distributor | 1.7 | |||
Alcon Pharma GmbH | Freiburg, Germany | Distributor | 0.5 | |||
Alcon Labortories, Inc. | Delaware, USA | Manufacturer and Distributor | 0.1 | |||
S.A. Alcon-Couvreur N.V | Puurs, Belgium | Manufacturer and Distributor | 2.4 | |||
Alcon Cusi S.A | El Masnou, (Barcelona) Spain | Manufacturer and Distributor | 15.0 | |||
Laboratoires Alcon S.A. | Rueil-Malmaison, France | Manufacturer and Distributor | 13.5 | |||
Alcon Laboratorios do Brasil Ltda. | Sao Paulo, Brazil | Manufacturer and Distributor | 10.6 | |||
Alcon Laboratorios S.A. de C.V. | Mexico City, Mexico | Manufacturer and Distributor | 4.7 | |||
Alcon (China) Ophthalmic Product Co. Ltd. | Beijing, China | Manufacturer and Distributor | 1.2 | |||
Alcon Manufacturing, Ltd. | Texas, USA | Manufacturer | 0.1 | |||
Alcon Ireland B.V. | Amsterdam The Netherlands | Manufacturer | 0.1 | |||
Alcon Capital Corporation | Delaware, USA | Finance | 0.1 | |||
Alcon Coordination Center (N.V.) | Puurs, Belgium | Finance | 371.2 | |||
Alcon Credit Corporation | Hünenberg, Switzerland | Finance | 0.6 | |||
Alcon Finance PLC | Cork, Ireland | Finance | 0.1 | |||
Alcon Research, Ltd. | Texas, USA | Research & Development | 0.1 | |||
Trinity River Insurance Co. Ltd. | Bermudas | Captive Insurance | 0.1 |
The fire insurance value for fixed assets amounts to $1,383.3 and $1,105.4 at December 31, 2002 and 2001, respectively.
The following items are allocated to the appropriate headings of expenses by function in the consolidated statements of earnings for the year ended December 31.
2002 | 2001 | |||
Depreciation of property, plant and equipment | $ | 92.0 | $ | 78.3 |
Salaries and welfare expenses | 933.3 | 844.9 | ||
Direct material cost | 324.6 | 294.3 |