Ubisoft 2013 Annual Report Download - page 191

Governance and Internal Control
2013
186
CONTROL ACTIVITIES
1.8.2.4
In addition to the risk management system, the Group has many control processes at all levels of the
Company. Operational departments at head office play a crucial role in ensuring that subsidiaries’
initiatives comply with Group guidelines and providing support for risk management, especially when
local teams lack sufficient expertise.
The centralized organization of these support functions enables consistent dissemination of the major
policies and goals of the executive management:
 The management control department monitors the Company’s performance using operational
monitoring based on monthly reports from all Group subsidiaries. It also coordinates meetings
between executive management and the operational and finance departments at which the
various reporting indicators are reviewed, the differences between actual performance and initial
forecasts are analyzed, and the quarterly, interim, annual and multiannual forecasts can be fine-
tuned on the basis of actual figures and market outlooks as received from local and operational
teams. The financial controllers monitor the whole financial reporting cycle and constantly query
subsidiaries on their performance levels, earnings and business activity.
 The consolidation department draws up the Group’s monthly consolidated accounts, centralizing
all expertise on their preparation and analysis. It publishes the accounting procedures applicable
within the Group, particularly via the Group’s accounting policies manual. It ensures compliance
with applicable standards and regulations so as to provide a true picture of the Group’s business
activities and position.
 The treasury department arranges foreign exchange derivative contracts and coordinates cash
flow management at French and foreign subsidiaries, in particular by overseeing the dissemination
of cash pooling solutions and cash flow forecasting. It checks the suitability and smooth interaction
of exchange rate and liquidity risk management policies, as well as the publication of financial
information, and also manages off-balance sheet commitments (bank guarantees relating to
purchase financing or L/Cs, comfort letters, share price guarantees, deposits, etc.). It centralizes
and verifies the authorizations granted to a limited number of employees, who are exclusively
authorized by executive management to handle certain financial transactions – subject to
predefined thresholds and authorization procedures – and helps implement tools to ensure
effective control (double signature procedure, secure payment mechanisms, frequently updated
authorization and signature system, controlled IT access, etc.)
 Acquisitions are managed by the acquisitions department, which reports to the finance
department, which examines and assesses the strategic interest of the planned total or partial
takeover of a company and submits the relevant proposal to executive management, who makes
the final decision. No Group subsidiary can make this decision on its own.
 Legal departments, which are specialized in company law, contract law, litigation and intellectual
property, assist and advise the subsidiaries on legal matters (acquisitions, contracts, leases, stock
market regulations, corporate governance, etc.). They coordinate joint studies or those of interest
to the Group and support local entities on legislative issues so as to control risks in the various
fields.
 The tax department assists and advises the Group’s French and foreign companies with the
analysis of the tax aspects of their projects. In coordination with the various internal departments,
it ensures the Group’s tax security by organizing risk prevention, identification and management. It
implements the Group’s transfer price policy and ensures that this is applied correctly.