Audi 2015 Annual Report Download - page 192

REPORT ON EXPECTED DEVELOPMENTS, RISKS AND OPPORTUNITIES
REPORT ON RISKS AND OPPORTUNITIES
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concerning the subsidiaries are regularly coordinated during
the year between the Consolidated Financial Statements de-
partment and the subsidiary in question. The “dual control
principle” and the separation of functions are likewise applied
by way of key instruments of control in the preparation of the
financial statements by the Group companies. In addition,
Group Auditing examines the regularity of the financial report-
ing process for domestic and foreign companies. Changes in the
statutory framework and prescribed standards with respect to
the financial reporting process are continually observed and
are acted on promptly where relevant for the Company. This
ensures compliance with standards.
Financial reporting is mapped on the basis of the Group-wide
Volkswagen consolidation and corporate management system
(VoKUs). Furthermore, continuous information sharing with
Volkswagen Group Accounting takes place. VoKUs contains
both historical data from Accounting and planning data from
Controlling, and as such provides extensive scope for consoli-
dation and analysis. The system also offers central master data
management, a uniform reporting system, an authorization
concept and maximum flexibility to adapt to changes in the
legal framework. Data consistency is checked with the aid of
systematic, multi-stage validation functions, such as com-
pleteness and content plausibility checks on the Balance
Sheet, Cash Flow Statement, Income Statement and Notes.
// RISK EARLY WARNING SYSTEM AND
MONITORING OF EFFECTIVENESS
Risk management is subject to wide-ranging statutory require-
ments. Section 91, Para. 2 of the German Stock Corporation
Act (AktG) governs the early identification obligations of the
Board of Management concerning risks that are a threat to the
Company as a going concern (supplemented by the German
Corporate Control and Transparency Act [KonTraG]). Section 107,
Para. 3 of the German Stock Corporation Act (AktG) (supple-
mented by the German Accounting Law Modernization Act
[BilMoG]) obliges the Audit Committee of the Supervisory
Board to monitor the effectiveness of the Risk Management
System and Internal Control System.
The Board of Management is responsible for the organizational
structure of the Risk Management System and Internal Control
System. To meet the statutory requirements, the Audi Group
relies on an overarching systemic approach to risk identifica-
tion, assessment and documentation that takes account of the
accompanying risk management and control methods. The
Group-wide systematized risk identification process (govern-
ance, risk & compliance/GRC process) generates an overall
picture of the risk situation. Meanwhile, the effectiveness of
the control processes and overall system is assessed.
GRC process
/// RISK CONSOLIDATION GROUP
All participations are assessed according to quantitative and
qualitative features using a uniform selection process and
classified according to risk criteria. As of December 31, 2015,
the risk consolidation group resulting from this process com-
prises AUDI AG along with 23 other subsidiaries, which have
carried out the GRC process in full.
Germany:
>AUDI AG
>Audi Electronics Venture GmbH
>CC WellCom GmbH
>PSW automotive engineering GmbH
>quattro GmbH
International:
>AUDI AUSTRALIA PTY LTD
>AUDI BRUSSELS S.A./N.V.
>Audi Canada Inc.
>Audi (China) Enterprise Management Co., Ltd.
>AUDI DO BRASIL INDUSTRIA E COMERCIO DE
VEICULOS LTDA.
>AUDI HUNGARIA MOTOR Kft.
>AUDI HUNGARIA SERVICES Zrt.
>Audi Japan K.K.
>Audi of America, LLC
>AUDI SINGAPORE PTE. LTD.
>AUDI TOOLING BARCELONA S.L.
>Audi Volkswagen Korea Ltd.
>AUDI VOLKSWAGEN MIDDLE EAST FZE
>Audi Volkswagen Taiwan Co., Ltd.
Reporting
Selection of relevant
companies
(risk consolidation
group)
Subsequent actions Identification,
assessment and
documentation of risks
Monitoring of
implementation and
effectiveness of the
instruments