Volvo 2015 Annual Report Download - page 182

Volvo’s auditors are elected by the Annual General Meeting. The current
auditor is PricewaterhouseCoopers AB (PwC), which was elected at the
Annual General Meeting 2014 for a period of four years. Two partners of
PwC, Peter Clemedtson and Johan Palmgren, are responsible for the
audit of Volvo. Peter Clemedtson is Lead Partner.
The external auditors discuss the external audit plan and risk management
with the Audit Committee. The auditors review the interim report for the
period January 1 to June 30 and audit the Annual Report and the consoli-
dated accounting. The auditors also express an opinion whether this Corpo-
rate Governance Report was prepared or not, and in such respect whether
certain information therein coincides with the Annual Report and consoli-
dated accounting. The auditors report their findings with regard to the annual
report and consolidated accounting through the audit reports and a separate
opinion regarding the Corporate Governance Report, which they present to
the Annual General Meeting. In addition, the auditors report detailed findings
from their reviews to the Audit Committee three times a year and once a year
to the full Board of Directors.
When PwC is retained to provide services other than the audit, it is
done in accordance with rules decided by the Audit Committee pertaining
to pre-approval of the nature of the services and the fees.
For information concerning Volvo’s remuneration to the auditors, refer
to Note 28 “Fees to the auditors” in the Group’s notes in the Annual Report.
Auditors PricewaterhouseCoopers AB
Peter Clemedtson
Authorized Public Accountant.
Lead Partner.
Auditor since 2012.
Peter Clemedtson’s other listed
clients are Nordea AB, SKF AB
and Ratos AB. His unlisted
clients include Stena AB and Wal-
lenbergstiftelserna.
Born 1956.
Johan Palmgren
Authorized Public Accountant.
Partner.
Auditor since 2015.
Johan Palmgren’s other listed
clients include Hexatronic
Group AB.
Born 1974.
External auditing
7
Governance principles
The Volvo Group’s mission, vision and strategic priorities serve as basis for
the governance and decision-making in the Group. More detailed govern-
ance principles are however set out in the Group’s policies and directives,
such as the Code of Conduct and policies pertaining to investments,
financial risks, accounting, financial control and internal audit, which con-
tain Group wide operating and financial rules for the operations, as well as
responsibility and authority structures.
Organizational structure
As from March 1, 2016, the Volvo Group will introduce a brand-based
organization with clearer commercial accountability for the Group’s trucks
sales operations. The former single Group Trucks Sales division will be
replaced by four brand specific Business Areas which will have responsi-
bility for their respective profitability. A new Business Area called Value
Trucks & JVs will also be introduced to meet the specific needs of the
Group’s truck customers in the value truck segments.
The Truck Division Group Trucks Technology (GTT) will continue to be
responsible for product development of engines, transmissions and
trucks. The Truck Division Group Trucks Operations (GTO) will still be
responsible for the production of trucks and the Group’s engines and
transmissions. GTO is also responsible for the Group’s spare parts supply
and logistics operation.
Further a new third Truck Division for the purchasing organization,
Group Trucks Purchasing (GTP) will be introduced. With the creation of
GTP, the Group’s purchasing activities will be moved out of GTO into a
separate Truck Division.
As per March 1, 2016, the Volvo Group’s business activities will there-
fore be organized into ten Business Areas, namely: Volvo Trucks, UD
Trucks, Renault Trucks, Mack Trucks, Value Trucks & JVs, Volvo Construc-
tion Equipment, Volvo Buses, Volvo Penta, Governmental Sales and Volvo
Financial Services (VFS).
With this governance model, Volvo will utilize the synergies of having
global organizations for manufacturing, product development and purchas-
ing, while still having clear leadership and responsibility for each truck brand
to make sure that customer needs are understood throughout the entire
organization. The goal of the governance model is for all of the Group’s Busi-
ness Areas to be driven along the same distinct business principles and the
Group’s decided brand positioning, whereby each Business Area can follow
and optimize its own earnings performance in the long and short term.
Governance principles and organizational structure
9
Volvo’s internal audit function, Corporate Audit, helps the organization
accomplish its objectives by bringing a systematic, disciplined approach
to improve and evaluate independently and objectively the effectiveness
of risk management, control, and governance processes.
In the discharge of its duties, Corporate Audit performs internal audits
and special assignments requested by management and the Audit Com-
mittee and issues reports summarizing the results of these activities.
The audits cover, among others, assessments on the adequacy and effec-
tiveness of the organization’s processes for controlling its activities and man-
aging its risks and evaluation of compliance with policies and directives.
Corporate audit
8
Corporate Audit also assists in investigations of suspected fraudulent
activities within the organization and coordinates and provides oversight
of other control and monitoring functions.
The head of Corporate Audit reports directly to the CEO, the Group’s
General Counsel and the Board’s Audit Committee.
For additional information on internal control over financial reporting,
see pages 186-187.
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CORPORATE GOVERNANCE CORPORATE GOVERNANCE REPORT 2015