Annual report - HSE

Committee work overview
Besides discussing and assessing the adequacy of credit limits, which is its main and
regular task, in 2012 the Committee dedicated a lot of its attention to formal arrangement
of monitoring and recording of business events. In this view, the body discussed the HSE
Group’s Accounting manual, the basic part of which are the Group’s accounting policies,
chart of accounts, as well as the Accounting rules of the Group and the company. The
Committee approved the final version of the discussed documents, which were prepared
by the accounting departments within the HSE Group, and submitted them to the Managing
director to sign them.
The Committee also monitored the preparation of the Controlling Manual of the company
and the Group, which should be finished and signed in 2013, according to the adopted
decisions. The main purpose of the Controlling Manual, which is a follow-up of the
Accounting Manual, will be more current preparation of monthly and periodic reports, as
well as clearer instructions regarding identification of deviations from business plans and
proposing of correctional measures.
Due to inconsistencies during the preparation of bases for investments and their realisation
by the Group companies, the R&D Sector drafted Rules on Deciding, Valuation, Monitoring
and Performing of Projects. The document was submitted also for the Committee’s review
of amendments and is still in the proposing phase.
Within the scope of discussing credit limits, the Committee prepared specific
recommendations to colleagues and the Managing Director of the company with the
purpose of managing the risks arising for the primary activity, i.e. trading with electricity
and relative products (ex. emission coupons within the framework of ETS).
Due to volatile market conditions and the need of fact reactions in determining limits,
the Committee adopted a decision in line with its Rules of Procedure and advised the
company’s Managing Director to appoint a sub-committee for credit risks. The Subcommittee
already set its Rules of Procedure, which were confirmed by the Committee, so
the sub-committee could start with its activities by the end of the year. The Committee was
acquainted also with the HSE’s intention to enter retail energy market and adopted certain
recommendations in relation to this.
In 2012, the Committee implemented the practice of continuous monitoring of the
investment project Unit 6 at TEŠ and relating liquidity conditions within the company and
the Group. In terms of financial position analysis, the Committee was acquainted with the
report ‘HSE company financial ratios from the perspective of Article 14 of ZFPPIPP’.
Its other regular tasks include review of annual reports, monitoring of business plan
implementation, analysis of business procedures and preparation of work programme for
the next business periods.
Conclusion
The Annual Report summary shows that, in spite of complex circumstances in 2012,
the Committee monitored and discussed all key risks of the company, prepared its
recommendations and submitted its decisions for signature of the Managing Director, the
subsidiaries’ managing directors and other people in charge.
It should be taken into account, that the Committee is an advisory body; therefore, its
decisions do not have executive power, which is the right way as it could shake the question
of responsibility.
Ljubljana, 4 March 2013
Borut Meh
President of the RMC
Annual Report HSE 2012
2 Business Report
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