83 7KHEDVLVIRUWKHLQWHUQDOFRQWUROUHODWLQJWR¿QDQFLDOUHSRUWLQJ consists of an overall control environment in which the organization, decision-making routes, authorities and responsibilities have been documented and communicated in management documents, VXFKDV$$.¶V¿QDQFLDOSROLF\UDZPDWHULDOSXUFKDVLQJSROLF\ WKHPDQXDORQ¿QDQFLDOUHSRUWLQJDQGWKHDXWKRULDWLRQUXOHV VHWE\WKH&(2$$.¶V¿QDQFHIXQFWLRQVDUHLQWHJUDWHGWKURXJK DMRLQWFRQVROLGDWLRQV\VWHPDQGMRLQWDFFRXQWLQJLQVWUXFWLRQV 7KH*URXS¶V¿QDQFHXQLWZRUNVFORVHO\DQGHIIHFWLYHO\ZLWKWKH FRQWUROOHUVRIVXEVLGLDULHVLQUHODWLRQWR\HDUHQG¿QDQFLDOVWDWH- ments and reporting. $VDVXSSOHPHQWWRWKHLQWHUQDOFRQWUROXQGHUDVSHFL¿FSODQDQ annual audit of some units in the Group is carried out on a rotating basis by the Group’s central Finance Department, in collabora- WLRQZLWKDQLQGHSHQGHQWLQWHUQDWLRQDODFFRXQWLQJ¿UP$$.KDV decided not to set up a separate review function (internal audit), DVWKHIXQFWLRQVPHQWLRQHGDERYHIXO¿OWKLVWDVNZHOO$OORI$$.¶V subsidiaries report on a monthly basis. These reports form the EDVLVIRUWKH*URXS¶VFRQVROLGDWHG¿QDQFLDOUHSRUWLQJ(DFKOHJDO XQLWKDVDFRQWUROOHUZKRLVUHVSRQVLEOHIRUWKH¿QDQFLDOPDQDJH- PHQWRIHDFKEXVLQHVVDUHDDQGIRUHQVXULQJWKH¿QDQFLDOUHSRUWV are correct, complete and delivered in time for consolidated reporting. Risk assessment and risk management Through its international presence, the AAK Group is exposed to a number of different risks. Risk management within the Group is UXQLQDFFRUGDQFHZLWK¿HGSROLFLHVDQGSURFHGXUHVZKLFKDUH reviewed annually by AAK’s Board. Risks relating to commodities are managed using the Group’s raw material purchasing policy. Risks relating to currency, interest and liquidity are mainly JRYHUQHGE\$$.¶V¿QDQFHSROLF\7KH*URXS¶VFUHGLWSROLF\ directs the management of credit and contract risks. Effective risk management unites operational business development with the requirements of owners and other stakeholders for improvements in control and long-term value. Risk management aims to minimize risks, but also to ensure that opportunities are utilized in the best possible way. Risk management covers the following areas of risk: strategic risks relating to the market and sector, commercial, RSHUDWLRQDODQG¿QDQFLDOULVNVFRPSOLDQFHZLWKHWHUQDODQG LQWHUQDOUHJXODWRU\IUDPHZRUNVDQG¿QDQFLDOUHSRUWLQJ7KHPDLQ FRPSRQHQWVRIULVNDVVHVVPHQWDQGPDQDJHPHQWDUHLGHQWL¿FD- tion, evaluation, management, reporting, follow-up and control. For further information about AAK’s risk management, please see Note 3. Control activities 7KHULVNVLGHQWL¿HGUHODWLQJWR¿QDQFLDOUHSRUWLQJDUHKDQGOHGYLD the company’s control activities. These control activities aim to prevent, identify and correct errors and discrepancies. Control activities take the form of manual controls, such as reconciliation and stocktaking, automatic controls via the IT systems and general controls of the underlying IT environment. Detailed ¿QDQFLDODQDO\VHVRIWKHUHVXOWDQGIROORZXSDJDLQVWEXGJHWVDQG IRUHFDVWVVXSSOHPHQWWKHRSHUDWLRQVSHFL¿FFRQWUROVDQGSURYLGH RYHUDOOFRQ¿UPDWLRQRIWKHTXDOLW\RIWKHUHSRUWLQJ Information and communication 7RHQVXUHWKHFRPSOHWHQHVVDQGDFFXUDF\RILWV¿QDQFLDOUHSRUWLQJ the Group has adopted guidelines for information and commu- QLFDWLRQDLPHGDWHQVXULQJUHOHYDQWDQGVLJQL¿FDQWHFKDQJHRI information within business operations, both within each unit and to and from management and the Board. Policies, handbooks and ZRUNLQJSUDFWLFHVUHODWLQJWRWKH¿QDQFLDOSURFHVVDUHFRPPXQL- cated between the management and employees, and are available in electronic format and/or printed format. The Board receives regular feedback on internal control from the Audit Committee. To ensure that external information is correct and complete, AAK has an information policy adopted by the Board, which states what is to be communicated, by whom and in what way. Follow-up The effectiveness of the process for risk assessment and execution of control activities is followed up continuously. The follow-up covers both formal and informal procedures, which are used by those responsible at each level. The procedures include follow-up RIUHVXOWVDJDLQVWEXGJHWVDQGSODQVDQDO\VHVDQGNH\¿JXUHV 7KH%RDUGUHFHLYHVPRQWKO\UHSRUWVDERXWWKH*URXS¶V¿QDQFLDO SRVLWLRQDQGGHYHORSPHQW7KHFRPSDQ\¶V¿QDQFLDOVLWXDWLRQLV discussed at each Board meeting, and the management team DQDO\VHVWKH¿QDQFLDOUHSRUWLQJDWGHWDLOHGOHYHORQDPRQWKO\ basis. At Audit Committee meetings, the Committee follows up the ¿QDQFLDOUHSRUWLQJDQGUHFHLYHVUHSRUWVIURPWKHDXGLWRUVDERXW their observations. Policy documents AAK has a number of policies for the operations of the Group and its employees. These include: Ethics policy Ethical guidelines for the Group have been drawn up with the aim of clarifying the Group’s fundamental approach to ethical issues, both within the Group and externally with regard to customers and suppliers. Finance policy 7KH*URXS¶V¿QDQFHIXQFWLRQZRUNVLQDFFRUGDQFHZLWKLQVWUXF- tions adopted by the Board, which provide a framework for how the *URXS¶VRSHUDWLRQVVKDOOEH¿QDQFHGDQGIRUKRZIRUHDPSOH currency and interest risks are to be handled. Information policy The Group’s information policy is a document describing the Group’s general principles for the publication of information. Environmental policy The Group’s environmental policy provides guidelines for environmental work within the Group.
AAK Annual Report 2016
To see the actual publication please follow the link above