2012 Annual Report - ZTE

ANNUAL REPORT 2012Report of the PRC AuditorsErnst & Young Hua Ming (2013) Shen Zi No. 60438556_H01To the Shareholders of ZTE Corporation:We have audited the accompanying financial statements of ZTE Corporation which comprise the consolidated andcompany balance sheets as at 31 December 2012, the consolidated and company income statements, statementof changes in equity and cash flow statement for the year ended 31 December 2012 and notes to the financialstatements.I. MANAGEMENT’S RESPONSIBILITY FOR THE FINANCIAL STATEMENTSThe management of ZTE Corporation is responsible for the preparation and fair presentation of financial statements.Such responsibility includes: (1) preparation of the financial statements in accordance with the AccountingStandards for Business Enterprises to ensure fair representation; (2) the design, implementation and maintenanceof necessary internal controls so that the financial statements are free from material misstatement whether dueto fraud or error.II.RESPONSIBILITY OF THE CERTIFIED PUBLIC ACCOUNTANTOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our auditin accordance with the Chinese Auditing Standards issued by the Chinese Institute of Certified Public Accountants.Those standards require that we comply with ethical requirements of the Chinese Certified Public Accountantsand plan and perform the audit to obtain a reasonable assurance as to whether the financial statements are freefrom material misstatement.An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financialstatements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks ofmaterial misstatement of the financial statements, whether due to fraud or error. In making those risk assessments,certified public accountants consider the internal control relevant to the entity’s preparation of financial statementsin order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluatingthe appropriateness of the accounting policies used and the reasonableness of the accounting estimates madeby management, as well as evaluating the overall presentation of the financial statements.We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our auditopinion.149