LensCrafters 2013 Annual Report Download - page 67

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total exposure of the Group, as well as fixing the minimum credit credential requirements for
the counterparties authorized to engage derivative transactions.
A quarterly reporting system has also been implemented for the Control and Risk Committee
since 2007 to highlight the debt exposure and the hedging transactions implemented to
minimize “interest rate” risk, “exchange rate” risk and, since 2011, “counterparty risk”.
In 2013, this reporting was integrated with reporting the Group’s High Yield Currencies
exposure.
Another operational and control instrument that has been implemented for some time is the
Credit Policy, which is applicable to all the wholesale companies of Luxottica Group.
This policy defines the rules and responsibilities for the management and collection of credit
in order to prevent financial risks, optimize revolving credit and reduce losses on such
credits. In particular, this policy sets the guidelines for the following activities:
• apportionment and control of credit lines;
• monitoring of credit trends;
• soliciting unpaid/expired credits;
• management and control of legal actions;
• management and control of the appropriations and losses on credits;
• determination and control of terms of payment in the various markets; and
• control over warranty terms.
The Board of Directors annually assesses the adequacy, effectiveness and efficient
functioning of the control system, in accordance with the methods described in Section III of
this Report.
The Control and Risk Committee
On April 27, 2012, the Board of Directors set up the Control and Risk Committee, appointing
the independent directors Mr. Mario Cattaneo, Chairman, Ms. Elisabetta Magistretti, Mr.
Marco Reboa and Mr. Marco Mangiagalli, with combined extensive experience in
accounting, finance and risk management.
According to the provisions of its charter, last updated in July 2012, the Committee is
responsible for performing investigations, offering consultations and submitting proposals to
the Board of Directors.
In particular, the Committee performs the following activities:
• assists the Board in the execution of its tasks regarding internal controls;
• evaluates the preparation of the accounting and company records, together with the
manager appointed to carry out this task, having obtained the opinion of the
independent auditor and the Board of Auditors; also reviews the application of