sain t-gobain annu al report 2008 annual report
sain t-gobain annu al report 2008 annual report
sain t-gobain annu al report 2008 annual report
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• Reviews the interim and <strong>annu</strong><strong>al</strong> consolidated financi<strong>al</strong><br />
statements and the <strong>annu</strong><strong>al</strong> financi<strong>al</strong> statements<br />
of the company as presented by senior management,<br />
prior to their examination by the Board of Directors.<br />
• Reviews the scope of consolidation and the reasons why<br />
any companies have been excluded.<br />
• Reviews materi<strong>al</strong> risks and off-b<strong>al</strong>ance sheet commitments,<br />
based on an explanatory <strong>report</strong> drawn up by the Chief<br />
Financi<strong>al</strong> Officer.<br />
• Makes recommendations concerning the organization<br />
of the intern<strong>al</strong> audit function, and receives a copy<br />
of the intern<strong>al</strong> audit program as well as executive<br />
summaries of the intern<strong>al</strong> audit <strong>report</strong>s.<br />
• Reviews the extern<strong>al</strong> auditors’ work plan and conclusions,<br />
as well as the post-audit <strong>report</strong> prepared by the auditors<br />
setting out their main observations and describing<br />
the accounting options selected for the preparation<br />
of the financi<strong>al</strong> statements.<br />
• Conducts the auditor selection process, issues an opinion<br />
on the proposed statutory audit fee budget, and submits<br />
the results of the selection process to the Board.<br />
• Reviews the advisory and other services that the auditors<br />
and the members of their network are authorized to provide<br />
to the Compagnie de Saint-Gobain and other Group entities<br />
under auditor independence rules.<br />
• Obtains from the auditors the breakdown of the fees paid<br />
to them and to the members of their network by the Group<br />
over the past year, by category of service, and <strong>report</strong>s<br />
to the Board its opinion concerning the auditors’<br />
independence.<br />
The Committee met four times in <strong>2008</strong>, with an attendance<br />
rate of 100%. Three of these meetings were devoted<br />
to reviewing in detail the provision<strong>al</strong> 2007 consolidated<br />
financi<strong>al</strong> statements (January), the fin<strong>al</strong> 2007 consolidated<br />
financi<strong>al</strong> statements and financi<strong>al</strong> statements of the<br />
Compagnie de Saint-Gobain (March) and the <strong>2008</strong> interim<br />
consolidated financi<strong>al</strong> statements (July), and discussing these<br />
accounts with the Chief Executive Officer, the Chief Financi<strong>al</strong><br />
Officer and the auditors.<br />
At each meeting, it discussed with the auditors the main<br />
audit issues discussed with the Finance department during<br />
the accounts closing process, particularly the key risk<br />
exposures and materi<strong>al</strong> commitments described<br />
in the Chief Financi<strong>al</strong> Officer’s explanatory <strong>report</strong><br />
to the Committee.<br />
The Committee <strong>al</strong>so received regular updates of the situation<br />
concerning asbestos litigation in the United States.<br />
It discussed in detail with the auditors the financi<strong>al</strong><br />
and accounting consequences of this litigation for the<br />
American subsidiaries and the Group, in order to present<br />
a <strong>report</strong> on this issue to the Board at its next meeting.<br />
The Committee <strong>al</strong>so obtained assurance that a provision<br />
was set aside to cover the potenti<strong>al</strong> costs arising<br />
from investigations by the European competition authorities<br />
(see page 110).<br />
The Committee <strong>al</strong>so obtained information from each<br />
of the auditors concerning the amount of fees paid to them<br />
by Group companies in 2007 for statutory audit work<br />
and for other services. The auditors’ fees for 2007 and <strong>2008</strong> are<br />
presented on page 108. A procedure issued on October 1, 2003<br />
clearly defines the services that may be provided by<br />
the Group’s auditors and the members of their network,<br />
and the services that are prohibited.<br />
During the year, the Committee <strong>al</strong>so reviewed the <strong>2008</strong><br />
budget, the draft <strong>report</strong> of the Chairman on intern<strong>al</strong> control,<br />
the auditors’ <strong>report</strong> on treasury transactions, the Intern<strong>al</strong> Audit<br />
and Intern<strong>al</strong> Control department’s activity <strong>report</strong> for 2007,<br />
its <strong>2008</strong> intern<strong>al</strong> audit program and its activity <strong>report</strong><br />
for first-h<strong>al</strong>f <strong>2008</strong>, and the technic<strong>al</strong> notes issued by the<br />
Finance department during the first six months of <strong>2008</strong>.<br />
Lastly, the Committee held one-to-one discussions<br />
with the auditors, the Vice President – Financi<strong>al</strong> Management,<br />
the Vice President – Treasury, Financing, Risks & Insurance,<br />
the Senior Vice President in charge of Intern<strong>al</strong> Audit & Intern<strong>al</strong><br />
Control, and the Chief Financi<strong>al</strong> Officer, in accordance<br />
with the recommendations of the AFEP-MEDEF corporate<br />
governance code for public companies.<br />
The Committee <strong>report</strong>ed to the full Board on its activities<br />
during the Board meetings of January 24, March 20, July 24<br />
and September 18, <strong>2008</strong>.<br />
Appointments Committee<br />
Jean-Martin FOLZ, Chairman<br />
Bernard GAUTIER, from June 5, <strong>2008</strong><br />
Sylvia JAY<br />
Jean-Cyril SPINETTA<br />
Three members of the Committee, including the Chairman,<br />
are independent directors (see page 92).<br />
The Appointments Committee fulfils the duties of both<br />
the remunerations committee and the nominations<br />
committee provided for in the AFEP-MEDEF corporate<br />
governance code for public companies.<br />
MANAGEMENT REPORT<br />
99<br />
Saint-Gobain - <strong>2008</strong> Annu<strong>al</strong> Report