Porsche 2009 Annual Report Download - page 86

The group accounting manual of Porsche SE
and formal instructions ensure uniform recognition
and measurement based on the accounting policies
applicable at Porsche SE, also after deconsolidation
of the Porsche Zwischenholding GmbH group and the
Volkswagen group. The components of the formal re-
porting packages required to be prepared for Porsche
SE are set out in detail and updated regularly. The
reporting dates that are relevant for the reporting
units are set out in a reporting calendar.
In the course of preparation of the consoli-
dated financial statements, the reporting packages
are analyzed in detail, tested for plausibility and au-
dited. In addition, interviews are held with representa-
tives of the significant investments and the subsidiar-
ies of Porsche SE as part of the financial statements
closing process.
The data reports are processed in a consoli-
dation system, which is based on standard software
and to which access and rights are restricted by the
existing authorization and access rules. The clear de-
lineation of areas of responsibility and the application
of the dual control principle during preparation of the
financial statements is ensured by means of unambi-
guous rules.
The internal control system relevant for the fi-
nancial reporting process and the guidelines for Por-
sche SE and its remaining subsidiaries were imple-
mented with the involvement of Porsche SE’s internal
audit function. The control system and the guidelines
are subject to appropriateness reviews and are up-
dated on an ongoing basis.
Risk management and early risk warning
According to Sec. 91 (2) German Stock Cor-
poration Act (AktG), Porsche SE is required to operate
a risk management and early warning system which
allows the company to identify any risks to the ability
of the company to continue as a going concern at an
early stage. The risk management system of the Por-
sche SE group was set up to identify at an early stage
any potential risks to the ability of the group to con-
tinue as a going concern as well as any risks that
could significantly and negatively impact the net as-
sets, financial position and results of operations of
the group and to avoid these by means of suitable
countermeasures that allow the group to rule out any
risks to its ability to continue as a going concern.
Since deconsolidation of the Volkswagen
group and the Porsche Zwischenholding GmbH group
on 3 December 2009 and 7 December 2009, respec-
tively, for group accounting purposes in accordance
with IFRSs, Porsche SE now acts as a pure holding
company and its income consists mainly of dividend
payments from the two investments. Risks faced by
the (old) company Porsche AG used to have a direct
effect on Porsche SE but that is no longer the case,
in particular since termination of the domination and
profit and loss transfer agreement with Porsche SE.
The risks from investments therefore now only have
an indirect effect on Porsche SE in the form of valua-
tion, consolidation, dividend and liability risks. In addi-
tion, there are risks from the basic agreement and the
associated corporate restructuring as well as from
the investment held by Volkswagen AG in Porsche
Zwischenholding GmbH.
These structural changes are also considered
in the Porsche SE group’s risk management, which
consists of three autonomous, but nevertheless inte-
grated risk management subsystems. Two of these
subsystems are located at the level of Porsche
Zwischenholding GmbH and Volkswagen AG (we refer
to the section “Opportunities and risks of significant
investments”). The risks of relevance at the level of
Porsche Zwischenholding GmbH are covered by Por-
sche AG’s early risk warning system which it is re-
quired by Sec. 91 (2) German Stock Corporation Act
(AktG) to establish for the Porsche AG group. The
subsystems are intended to identify, manage and
monitor the risks resulting from the operating activi-
ties of the two investments that could jeopardize the
investment’s ability to continue as a going concern.
The two investments are themselves responsible for
their local risk management, but are required at the
same time to inform Porsche SE as the holding com-
pany at an early stage of any risks jeopardizing the
investment’s ability to continue as a going concern.
86 Group management report