Internal control of the financial reporting process and the main features of the risk management systems

Risk management

VVO Group’s risk management is based on the company’s risk management and financing policy, corporate governance and ethical guidelines, and the risk assessments carried out in connection with the annual strategic planning process. Risk management forms part of the company’s internal control, its purpose being to ensure that the company achieves its business objectives. Responsibility for arranging risk management rests with the Board of Directors. Risk management is based on the risk assessments carried out in connection with the strategy and annual planning processes, which involve identifying the most notable risks, evaluating their likelihood and potential impacts, and defining means to manage them. Any significant changes in risks in business operations and the business environment are evaluated regularly and reported to the Board of Directors as part of quarterly interim reporting.

Control environment

Principal responsibility for the internal control of financial reporting rests with the Board of Directors. The working order of the Board of Directors outlines the responsibilities of the Board and the division of duties within the Board and among its committees. The principal task of the Audit Committee appointed by the Board of Directors is to ensure that the principles outlined for financial reporting, risk management and internal control are complied with, and that appropriate contact is kept with the company’s auditors. It is the duty of the CEO to maintain an organisational structure in which responsibility, authority and reporting relationships are clearly and comprehensively defined in writing, and to ensure that the internal control environment is adequately resourced.

Financial reporting is governed by VVO Group’s operating principles, HR policy, financing policy, data security policy, accounting principles, and reporting instructions.

Control measures

VVO Group’s financial and operational reporting process complies with the Group’s operating instructions and current process descriptions. VVO Group’s financial management is responsible for the content of the reporting process and for compliance with instructions. The quality of reporting is ensured through process control measures. These include the reconciliation of accounts, system-generated controls, and inspections and other measures undertaken by management or others. Control functions have designated managers who are responsible for their sufficiency and the efficacy of their execution.

Control of the reporting and budgeting processes is based on VVO Group’s standardised reporting principles drawn up and maintained by the Group’s financial management.

 

 

© VVO Group plc 2015