The Supervisory Board reports that it has taken the opportunity to comprehensively monitor the management of the Company, both acting as a whole and periodically by means of its committees, Chairman and Deputy Chairman. Detailed presentations and discussions during meetings of the Supervisory Board and its committees served this purpose, as did recurring meetings with the members of the Managing Board, who provided detailed explanations and supporting documentation relating to the management and financial position of the Company and the Group. The strategy, business development, risk management, internal control system and activities of the internal audit department of the Company were also discussed in these meetings.
The Supervisory Board has formed four committees from among its members. Information on the responsibilities and composition of these committees is available on the Company’s website and in the Corporate Governance Report.
One Annual General Meeting, four Supervisory Board meetings and one closed Supervisory Board meeting were held in 2011. During the closed meeting, the Supervisory Board reviewed and discussed in detail the previous development of the Company and the Group and used this as a basis for discussions on the future strategy of the Group. Three meetings of the Audit Committee were also held. The Committee for Urgent Matters held one meeting and was also contacted in writing with regard to two matters. The Supervisory Board was informed of any resolutions passed by the committees at the next Supervisory Board meeting. The auditor of the financial statements and consolidated financial statements, PwC INTER-TREUHAND GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft (PwC), attended three Audit Committee meetings and three Supervisory Board meetings, including the meeting dealing with the auditing of the annual financial statements and consolidated financial statements and the formal approval of the annual financial statements, as well as the General Meeting. In addition, two meetings of the Committee for Managing Board Matters were also held in 2011.
No agenda items were discussed in the Supervisory Board and committee meetings without the participation of members of the Managing Board. No member of the Supervisory Board attended fewer than half of the Supervisory Board meetings. The Supervisory Board’s evaluation of its activities found that the practices followed satisfied the requirements of the Austrian Stock Corporation Act and the Code of Corporate Governance, and that its organisational structure and procedures were satisfactory in terms of efficiency.
By inspecting suitable documents, meeting with the Managing Board and holding discussions with the auditor, the Supervisory Board Audit Committee was able to form a satisfactory view of the accounting process and the procedure used for auditing the financial statements and consolidated financial statements and found no reasons for objection. The Supervisory Board Audit Committee also monitored the independence of the auditor of the financial statements and consolidated financial statements and after reviewing suitable documents and supporting records submitted to it, particularly with respect to additional services provided for the Company and the Group, was satisfied of the auditor’s independence.
The Audit Committee also reviewed the effectiveness of the internal control system, the internal auditing system and the risk management system by obtaining verbal and written descriptions of the processes and organisation of these systems from the Managing Board, the auditor and the individuals directly responsible for these areas. The Audit Committee also debated and discussed the quarterly reports prepared by the Internal Audit department. The Audit Committee reported on these monitoring activities to the Supervisory Board and stated that no deficiencies had been identified. The Supervisory Board was also given the opportunity during Supervisory Board meetings to satisfy itself about the functional adequacy of the existing control and auditing systems. The Supervisory Board found no reasons for objections.
In order to prepare the Supervisory Board’s proposal for selection of the auditor of the financial statements and consolidated financial statements, the Audit Committee requested that PwC submit documents concerning its license to audit. A written report was prepared stating that there were no grounds for exclusion or circumstances that could provide cause for concern regarding partiality. In addition, a list grouped by category of services showing the total revenues received by PwC from the Company in the previous financial year was requested and reviewed, and it was verified that PwC was included in a statutory quality assurance system. The Audit Committee reported to the Supervisory Board on the findings gained from these investigations and proposed to the Supervisory Board following the General Meeting that PwC be selected as auditor of the financial statements and consolidated financial statements.
In addition, the Supervisory Board Audit Committee received the 2011 annual financial statements, management report and corporate governance report from the Managing Board, and reviewed and carefully examined them. The Supervisory Board Audit Committee also carefully examined the 2011 consolidated financial statements and Group management report. The Managing Board’s proposal for appropriation of profits was also debated and discussed during the course of this examination. As a result of this examination and discussion, a unanimous resolution was adopted to recommend to the Supervisory Board that they be accepted without qualification. The committee chairman informed the Supervisory Board of the resolutions adopted by the committee.
The 2011 annual financial statements together with the management report and corporate governance report, the 2011 consolidated financial statements together with the Group management report, and the Managing Board’s proposal for appropriation of profits were subsequently taken up, thoroughly discussed, and examined by the Supervisory Board. In addition, the auditor’s reports prepared by PwC for the 2011 annual financial statements and management report and the 2011 consolidated financial statements and Group management report were reviewed by the Audit Committee and by the Supervisory Board, and debated and discussed in detail with PwC. The final findings of the audit provided no reason for objections. The Supervisory Board stated that it had nothing to add to the auditor’s reports for the financial statements and consolidated financial statements.
After a thorough examination, the Supervisory Board therefore adopted a unanimous resolution to approve the annual financial statements prepared by the Managing Board, to raise no objections to the management report, consolidated financial statements and Group management report, and to declare its agreement with the Managing Board proposal for appropriation of profits.
The 2011 annual financial statements have therefore been approved in accordance with § 96(4) of the Austrian Stock Corporation Act.
The Supervisory Board proposes to the General Meeting that it approve the Managing Board proposal for appropriation of profits and formally approve the actions of the Managing Board and Supervisory Board.
Vienna, March 2012
The Supervisory Board: