The accompanying consolidated financial statements and related notes of ADTRAN$^{™}$, Inc. were prepared by management, which has the primary responsibility for the integrity of the financial information therein. The statements were prepared in conformity with accounting principles generally accepted in the United States of America as appropriate in the cir- cumstances and include amounts which necessarily are based on management’s judgment. Financial information  presented elsewhere in this report is consistent with that in the financial statements. Management maintains a comprehensive system of internal accounting controls and relies on the system to  discharge its responsibility for the integrity of the financial statements. This system provides reasonable assurance that corporate assets are safeguarded, and that transactions are recorded in such a manner as to permit the preparation of reliable financial information. Reasonable assurance recognizes that the cost of a system of internal accounting controls should not exceed the related benefits. This system of internal accounting controls is augmented by written policies and procedures and the careful selection and training of qualified personnel. As of December 31, 2002, management was aware of no material weaknesses in the ADTRAN system of internal accounting controls. The financial statements have been audited by ADTRAN’s independent certified public accountants, whose opinion is expressed on the following page. Their audit was conducted in accordance with auditing standards generally accepted in the United States of America, and as such, they obtained an understanding of ADTRAN’s system of internal account- ing controls and conducted such tests and related procedures as they deemed necessary to arrive at an opinion on  the fairness of presentation of the financial statements. Management’s Responsibility for Financial Reporting Mark C. Smith Chairman and Chief Executive Officer James E. Matthews Senior Vice President - Finance and Chief Financial Officer 18 ADTRAN 2002 Annual Report