tem relevant to the Group’s financial
reporting process
The Management Board of Conergy AG is responsible for drawing up the consolidated financial statements in accordance with the International Financial Report- ing Standards (IFRS) as applicable in the EU, the com- bined management report as well as the quarterly and half-yearly reports. An adequate internal control and risk management system was established by the Management Board in order to ensure the accuracy and completeness of the figures and disclosures in the external reporting system as well as the propriety of the accounting on the whole.
The internal control and risk management system is intended to guarantee timely, uniform and accurate accounting for all business processes and transactions. It ensures compliance with legal standards, account- ing principles and the Group’s internal accounting guidelines that are binding on all subsidiaries that are
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ManageMent Board and SuperviSory Board | Group ManaGeMent report | ConSolidated FinanCial StateMentS | Further inForMation
Internal Indicators Reporting Process
included in the consolidated financial statements. Amendments of laws and revisions of accounting standards as well as other types of announcements are immediately analysed in terms of their relevance to and impact on our consolidated financial statements, and the guidelines are adjusted to reflect the resulting changes. Unequivocal specifications are intended to limit the discretion available to employees in connection with the recognition, measurement and presentation of assets and liabilities and thus the risk of inconsist- ent bookkeeping and accounting practices within the Group. These guidelines are available at all times to all employees involved in bookkeeping and accounting via the groupwide intranet.
The internal control system is also rooted in a number of process-integrated monitoring activities. These pro- cess-integrated monitoring activities comprise organi- sational safeguards such as a separation of functions, restrictions on access, organisational instructions and controls that are integrated into the workflows. In addition, monitoring activities that are uninvolved in business processes such as the monthly reporting and Internal Audit ensure that the internal control system is effective. The external auditor audits specific internal controls and judges their efficacy as part of the audit of the annual financial statements. Certain elements of the IT systems used are also audited. Any weaknesses in the internal control system are communicated to the appropriate supervisory and management bodies in that connection. However, not even appropriate and functional systems can provide absolute security. The centralised department, Corporate Accounting & Controlling, is tasked with managing the Group’s book- keeping and accounting process. Besides this, the Corporate Tax, Corporate Treasury and Corporate Legal departments are also fully integrated into a variety of separate processes serving to identify, measure, manage, monitor and communicate risks related to financial reporting.
All subsidiaries prepare their financial statements locally. In Germany, however, the Group’s own Shared Service Center provides these services to both Conergy AG and some of its German subsidiaries. The IT systems utilised for all significant companies in Germany are based on SAP while ERP software based on Navision is utilised for most of the other subsidiaries. All financial systems used are protected from abuse by means of appropriate authorisation processes and limitations on access. The Group IT department uses centralised management and monitoring of almost all IT systems, management of change processes as well
as regular system back-up processes to minimise both the risk of data loss and the failure of IT systems rele- vant to bookkeeping and accounting.
All companies included in the consolidated financial statements of Conergy AG transmit their financial statements to the Company on a monthly basis using a uniform groupwide data model that is subject to the Group’s IFRS accounting guidelines. All Group com- panies are responsible for complying with the guide- lines and procedures that apply groupwide as well as for ensuring that their bookkeeping and accounting processes are orderly and timely. All employees in- volved in the Group’s bookkeeping and accounting process are trained to that end on a regular basis. Contact persons at Conergy AG’s headquarters, who are primarily available to answer and resolve special questions and complex issues, support our local sub- sidiaries throughout the bookkeeping and accounting process.
The consolidated figures are drawn up centrally using the financial statements provided by the companies included in the consolidated financial statements. Centralised Corporate Accounting & Controlling is tasked with carrying out the consolidation process as well as certain aspects of reconciliation, monitoring all requirements related to deadlines and processes and ensuring compliance with reporting duties and dead- lines. The employees also monitor technical aspects of the controls and supplement them through manual reviews, correcting any defects and reporting them back to the subsidiaries. In addition, Conergy also possesses a groupwide reporting and controlling system, which makes it possible to detect deviations from targets and accounting inconsistencies regularly and early on.
The Audit Committee of Conergy’s Supervisory Board is responsible for monitoring the effectiveness of the Company’s control and monitoring systems. It requires both the Management Board and the auditors to report to it on a regular basis.
For details on the features of the risk management system, please see the disclosures in the “Risk and opportunity report” of the combined management report.