TomTom 2010 Annual Report Download - page 52

p 50 / TomTom Annual Report and Accounts 2010
Supervisory Board Report
EMPLOYEE ARRANGEMENTS AND SEVERANCE AGREEMENTS
All members of the Management Board have an employment contract
with the company. The employment contract with Alain De Taeye
entitled TomTom to request Alain De Taeye to resign on 19 September
2010 in which case the employment contract would be terminated
with mutual consent as of 30 September 2010. In 2010, with the
approval of the Supervisory Board, it was decided not to invoke this
right and continue the employment contract with some adjustments.
The company took this opportunity to align the severance payment
and the notification period provisions with those included in the
contracts of the other Management Board members.
Although all the employment contracts are entered into for an indefinite
period of time, the term of office of members of the Management
Board is four years. After this period, they can be re-appointed for
another term of not more than four years at a time. For all members
of the Management Board a notice period of 12 months is
applicable. In the event that the employment of a member of the
Management Board is terminated by or on the initiative of us, he or
she shall be entitled to a fixed amount of 50% of one year’s base
salary, including holiday allowance, unless the employment is
terminated for causes within the meaning of the articles 7:677 (1)
and 7:678 of the Dutch Civil Code, in which situation the
Management Board member is not entitled to any severance
compensation. This amount will be due in addition to the salary to be
paid to members of the Management Board during the agreed notice
period of 12 months. A member of the Management Board will not
be entitled to the severance if the employment is terminated by him
or her or on his or her initiative.
Members of the Supervisory Board are not entitled to any benefits
upon the termination of their appointment.
AUDIT COMMITTEE REPORT
Currently the Audit Committee comprises of Ben van der Veer
(Chairman), Doug Dunn and Rob van den Bergh.
Five Audit Committee meetings were held during the financial year,
all well attended, including the four meetings held prior to the
publication of the quarterly financial results which were attended by
all Audit Committee members. In December an additional meeting
was held to review, in advance of the publication of the Annual
Report, the valuation of goodwill and intangible assets.
The Audit Committee considers that there is sufficient breadth,
depth, industry relevant knowledge, experience and expertise for
them to appropriately discharge their duties. This includes
appropriate requisite financial skills and experience that would
reasonably be expected for an Audit Committee.
As a standard modus operandi of our Audit Committee, the
Management Board members, Marina Wyatt (CFO) and Alain De
Taeye, as well as the Director of Business Assurance, Robert Schiering,
attended all meetings. The external auditor attended all agenda items
related to the publication of quarterly results. During 2010 the Audit
Committee met separately (independently from management) with
the Director of Business Assurance and the external auditor. The
external auditor holds independent communication channels with the
Audit Committee.
During 2010 the Audit Committee invited the following people from
the organisation to attend meetings:
>the CEO in order to discuss the most important strategic group
risks and related mitigating actions, and
>the most senior leaders of IT, Tax, Treasury and Investor
Relations.
ACTIVITIES
The Audit Committee assisted the Supervisory Board in overseeing
the following areas of the business:
>the integrity of the company’s quarterly financial results under
IFRS, annual report and related press releases including the
company’s accounting and financial reporting policies and
processes, disclosure controls and procedures and financial
statement audits
>relations with the external auditor, including the scope of their
plans, assessment of their independence, approval of their
remuneration, and their annual re-appointment
>the role and functioning of the internal audit department which
is part of the Business Assurance team which also handles
business risk management
>the maintenance of an effective system of risk management
and internal control relating to strategic, financial, operational
and compliance risks
>compliance with the recommendations and observations of
the internal and external auditors
>review of the approach to treasury and foreign exchange
management
>the financing of the company
>the application of information and communication technology
(ICT)
>the policy of the company on tax planning and compliance, and
>the companies code of ethics and the approach taken to
protecting and securing key company assets.
Included in the Audit Committee charter is the supervision of
compliance with legal and regulatory requirements. This topic was
covered by the Supervisory Board through discussions with the Group
General Counsel and therefore did not form part of the agenda of
the Audit Committee in 2010.
In July 2010 the Audit Committee performed an assessment of the
Audit Committee Charter and resolved that no changes were necessary.
The audit committee charter is available on the TomTom website.