TomTom 2012 Annual Report Download - page 18

TomTom Annual Report and Accounts 2012
16
Management Board Report | continued
In Control Statement and Responsibility
Statement
The Management Board is responsible for TomTom’s risk
management and internal control systems. The Management
Board believes that the company maintains an adequate and
effective system of risk management and internal control that
complies with the Dutch Corporate Governance Code (the Code).
The internal control systems are designed to manage, rather than
eliminate, the risk of failure to achieve business objectives and can
provide reasonable, but not absolute, assurance against fi nancial
loss or material misstatements in the fi nancial statements.
TomTom views the management of risk as a management activity.
The Management Board reviews the effectiveness of TomTom’s
systems of internal control relative to strategic, fi nancial,
operational and compliance risks and discusses risk management
and internal controls with the Audit Committee on at least a
quarterly basis.
TomTom embeds risk management in its strategic business
planning. A top-down approach is followed in which management
identifi es the major risks that could affect the company’s business
objectives – and assesses the effectiveness of the processes and
internal controls in place to manage and mitigate these risks. For
an overview of our most important business risks, please refer
to the Business Risks section on pages 12 – 15. Assurance on
the effectiveness of controls is obtained through management
reviews, control self-assessments, internal audits and testing of
certain aspects of the internal fi nancial control systems by the
external auditors during their annual audit.
This, however, does not imply that TomTom can provide certainty
as to the realisation of business and fi nancial objectives, nor
can the approach taken by the company to internal control
over fi nancial reporting be expected to prevent or detect all
misstatements, errors, fraud or violation of law or regulations.
The key features of the systems of internal control are as follows:
– Clearly defi ned lines of accountability and delegation of
authority are in place, together with comprehensive reporting
and analysis against approved budgets.
– Operating risk is minimised by ensuring that the appropriate
infrastructure, controls, systems and people are in place
throughout the business.
– An organisational design is in place that supports business
objectives and enables staff to be successful in their roles.
– Treasury operations manage cash balances and exposure to
currency transaction risks through treasury policies, risk limits
and monitoring procedures.
– A Code of Ethics is embedded in the TomTom culture and is
accessible to all staff via the intranet.
The key controls over fi nancial reporting policies and procedures
include controls to ensure that:
– commitments and expenditures are appropriately authorised
by the Management Board
– records are maintained which accurately and fairly refl ect
transactions
– any unauthorised acquisition, use or disposal of TomTom’s
assets that could have a material effect on the Financial
Statements are detected on a timely basis
– transactions are recorded as required to permit the preparation
of fi nancial statements, and
– TomTom is able to report its fi nancial statements in compliance
with IFRS.
The Management Board believes, based on the activities
performed in 2012 and in accordance with best practice provision
II.1.5 of the Code, that the risk management and control systems
with regard to the fi nancial reporting risks have functioned
effectively in 2012, and that the risk management and control
systems provide reasonable assurance that the 2012 fi nancial
statements do not contain any errors of material importance.
With reference to the statement within the meaning of article
5:25 (2c) of the Financial Supervision Act, the Management Board
states that, to the best of its knowledge:
– the annual fi nancial statements give a true and fair view of
the assets, liabilities, fi nancial position and profi t or loss of the
company and the undertakings included in the consolidation
taken as a whole; and that
– the Management Board Report includes a fair review of
the development and performance of the business and the
position of the company and the undertakings included in the
consolidation taken as a whole, together with a description of
the principal risks and uncertainties that the company faces.
Amsterdam, 12 February 2013
The Management Board
– Harold Goddijn | CEO
– Marina Wyatt | CFO
– Alain De Taeye