Mercedes 2009 Annual Report Download - page 106

102
Risks and opportunities
Daimler’s divisions are exposed to a large number of risks which
are inextricably linked with their entrepreneurial activities. In
order to identify, evaluate and deal consistently with these risks,
we make use of effective management and control systems;
we have combined these systems in a uniform risk management
system, which is described below.
Entrepreneurial activity primarily consists of creating and utilizing
opportunities in order to secure and strengthen the company’s
competitiveness. Entrepreneurial opportunities are not reported
within our risk management system, but are included in the
annual operational planning and followed up during the year in
the context of periodical corporate reporting. The divisions are
directly responsible for the early identification of opportunities and
their utilization. Within the framework of the strategy process,
longer-term opportunities for further profitable growth are identi-
fied and brought into the decision-making process. Further
information on this subject is provided on page 116 of the Man-
agement Report.
Risk management system
(Report and explanation provided pursuant to Section 315,
Subsection 2 Number 5 and Section 289, Subsection 5 of the
German Commercial Code (HGB))
The risk management system with regard to material risks
and risks threatening the existence of the Group is integrated
into the value-based management and planning system of Daimler
AG and the Group. It is an integral part of the overall planning,
management and reporting process in all relevant legal entities,
divisions and central functions. It aims to systematically identify,
assess, monitor and document material risks and risks threatening
the existence of Daimler. Risk assessment principally takes place
for a two-year planning period, although in the discussions for the
derivation of medium-term and strategic goals, Daimler identifies
and monitors longer-term risks. In the context of the two-year oper-
ational planning, with the use of defined risk categories, risks
are identified for the divisions and operating units, the major asso-
ciated companies and the central departments, and are assessed
regarding their probability of occurrence and possible extent of
damage. Assessment of the possible extent of damage usually
takes place in terms of the risks’ impact on EBIT. The reporting of
relevant risks is based on fixed value limits. The responsible per-
sons also have the task of developing, and initiating as required,
measures to avoid, reduce and hedge risks. Material risks and
the countermeasures taken are monitored within the framework
of a regular process. As well as the regular reporting, there is
also an internal reporting obligation within the Group for risks
arising unexpectedly. The Group’s central risk management
department regularly reports on the identified risks to the Board
of Management and the Supervisory Board.
The internal control and risk management system with
regard to the accounting process has the goal of ensuring
the correctness and effectiveness of accounting and financial
reporting. It is continually further developed and is an integral
part of the accounting and financial reporting process in all
relevant legal entities and central functions. The system includes
principles and procedures as well as preventive and detective
controls. Among other things, we regularly check that:
–
the Group’s uniform financial reporting, valuation and
accounting guidelines are continually updated and regularly
trained and adhered to;
– transactions within the Group are fully accounted for and
properly eliminated;
– issues relevant for financial reporting and disclosure from
agreements entered into are recognized and appropriately
presented;
– processes exist to guarantee the completeness of financial
reporting;
– processes exist for the segregation of duties and for the
“four-eyes principle” in the context of preparing financial
statements, as well as for authorization and access rules
for relevant IT accounting systems.
Risk Report