Adidas 2003 Annual Report Download - page 117

COMMITTEE ACTIVITIES /// In the year under review, the
Supervisory Board had three standing committees and a
“Convertible Bond/Bond with Warrants” Committee which
was established for a limited period of time. The members of
the respective committees are shown in the section listing
the Supervisory Board members.
The General Committee dealt with personnel matters
related to the Executive Board on seven occasions in 2003, in
meetings and in resolutions by way of circular vote.
The Audit Committee, established in July 2003, met three
times in the year under review. The Audit Committee and the
auditor discussed in detail the limited scope review of the
financial statements for the first half year and dealt with the
financial statements for the third quarter. The Committee also
discussed additional audit priorities and the fee arrangement
for the auditor. The Supervisory Board plenum was always
informed in detail about the matters discussed at the meet-
ings of the Audit Committee.
The Mediation Committee, formed in accordance with
§27section 3 of the German Co-Determination Act
(MitBestG), submits proposals to the Supervisory Board
regarding the appointment or dismissal of Executive Board
members if the two-thirds Supervisory Board majority neces-
sary for an appointment/dismissal is not achieved. This
committee did not meet in 2003.
The Supervisory Board “Convertible Bond/Bond with
Warrants” Committee, set up in August for a limited period of
time, discussed in detail the structure and conditions of the
convertible bond issued in October and the exclusion of
shareholders’ preemptive rights, and thereupon approved
issuance of the bond.
EXAMINATION OF THE 2003 FINANCIAL STATEMENTS AND
CONSOLIDATED FINANCIAL STATEMENTS /// KPMG
Deutsche Treuhand-Gesellschaft Aktiengesellschaft
Wirtschaftsprüfungsgesellschaft, Frankfurt am Main, audited
the financial statements of adidas-Salomon AG for the year
under review as prepared by the Executive Board in line with
the provisions of the German Commercial Code (HGB) as well
as the management report. The auditor issued an unqualified
opinion thereon.
As in the previous year, the consolidated financial state-
ments were prepared in compliance with International Finan-
cial Reporting Standards (IFRS). Under the provisions of
§ 292a HGB, these financial statements exempt adidas-
Salomon AG from drawing up consolidated financial state-
ments in accordance with German Commercial Law. The
auditor issued an unqualified opinion on the consolidated
financial statements and the Group management report.
The financial statements and the auditor’s reports were
presented to all the members of the Supervisory Board in a
timely manner. They were discussed in detail first at the
meeting of the Audit Committee on March 2, 2004 and subse-
quently at the annual financial statements meeting of the
Supervisory Board on March 9, 2004. The Audit Committee
also reported to this meeting in detail on the scope, priorities
and cost of the audit. The auditor was present at the annual
financial statements meetings of the Supervisory Board and
the Audit Committee. He reported on the material results of
the audit and was available for the provision of supplementary
information.
Having examined the consolidated financial statements,
the financial statements of adidas-Salomon AG, the manage-
ment reports and the proposal put forward by the Executive
Board regarding the appropriation of retained earnings, the
Supervisory Board approved the results of the audit. At its
meeting on March 9, 2004, the Supervisory Board approved
the financial statements and the consolidated financial state-
ments. The Supervisory Board also agreed with the proposal
put forward by the Executive Board regarding the appropria-
tion of retained earnings.
CORPORATE GOVERNANCE /// After approving the adidas-
Salomon Corporate Governance Principles and establishing
an Audit Committee, we authorized an updated Declaration of
Compliance in April 2003, which was then made permanently
available to shareholders via the Internet. In May 2003,
adidas-Salomon designated a Corporate Governance Officer
who reports directly to the Executive Board and the Supervi-
sory Board. We have included the amendments to the German
Corporate Governance Code which became effective in May
2003 in a Declaration of Compliance published in February
2004. The Corporate Governance working group will review
and further develop the adidas-Salomon Corporate Gover-
nance Principles approved by the Executive and Supervisory
Boards in light of the changes to the German Corporate
Governance Code which came into effect in May 2003.
CHANGES ON THE EXECUTIVE BOARD /// Ross McMullin,
member of the Executive Board and responsible for business
in North America, resigned from his office as a member of the
Executive Board for health reasons effective December 8,
2003. Effective January 1, 2004, Erich Stamminger assumed
responsibility for Region North America in addition to his
existing duties as the Executive Board member responsible
for Global Marketing.
OUTLOOK /// The results for 2003 confirm adidas-Salomon’s
strong performance, by meeting all our major financial
targets. Additionally, the results that are stated in this annual
report illustrate notable operational improvements. The
Supervisory Board believes the Group will also continue to
succeed in meeting its established targets in the future.
We appreciate the tremendous work of the Executive
Board, including Ross McMullin who resigned in December,
as well as the Management Boards of the Group companies,
the Works Council and all adidas-Salomon employees. We
thank all of them for their ongoing commitment.
For the Supervisory Board
Henri Filho /// Chairman of the Supervisory Board
March 2004
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