85
Control environment
AAK’s organization is designed to facilitate quick decision-making.
Operational decisions are therefore made at business area or
subsidiary level, while decisions about strategies, acquisitions and
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Group management team. The organization is characterized by
clear division of responsibilities and effective and established management
and control systems, covering all units within AAK.
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consists of an overall control environment in which the organization,
decision-making routes, authorities and responsibilities have
been documented and communicated in management documents,
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joint consolidation system and joint accounting instructions. The
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reporting.
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annual audit of some units in the Group is carried out on a rotating
basis by the Group’s central Finance Department, in collabora-
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decided not to set up a separate review function (internal audit),
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subsidiaries report on a monthly basis. These reports form the ba-
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rect, 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
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viewed 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 governed by
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ment 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 man-
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risks, compliance with external and internal regulatory frameworks
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porting, follow-up and control. For further information about AAK’s
risk management, please see Note 3.
Control activities
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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 con-
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of the result and follow-up against budgets and forecasts supple-
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tion of the quality of the reporting.
Information and communication
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the Group has adopted guidelines for information and commu-
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information within business operations, both within each unit and
to and from management and the Board. Policies, handbooks and
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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 of
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at each Board meeting, and the management team analyzes the
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At Audit Committee meetings, the Committee follows up the
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their observations.
Policy documents
AAK has a number of policies for the operations of the Group and
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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
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tions adopted by the Board, which provide a framework for how the
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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.