Ubisoft 2016 Annual Report Download - page 50

Governance, risks, riskmanagement andinternalcontrol
3Report of the Chairman of the Board of Directors on corporate governance, internal control andriskmanagement
performance through regular appraisals, development plans,
appropriate training, stock options, employee share subscription
plans, etc.
ADAPTED SOLUTIONS AND OPERATING
METHODS
The IT teams provide the different business lines with solutions that
are adapted to their activities. They defi ne, implement and operate
these solutions. The range of solutions used includes commercial
software as well as tools developed internally. This range is constantly
evolving in line with the ever increasing requirements in managing
and analyzing information, while ensuring compliance with the
security standards in place at Ubisoft.
Similarly, each subsidiary and team strives to continuously improve
processes and documentation. This also involves frequently
reviewing and updating procedures to ensure uniform application.
These procedures are made available to the relevant teams through
collaborative tools developed by the Group.
Procedures associated with the preparation of accounting and
fi nancial information are described in section 3.1.3.3.
3.1.3.3 Control activities
In addition to the risk management system, the Group has many
control processes at all levels of the Company. Operational
departments at head offi ce play a crucial role in ensuring that
subsidiaries’ initiatives comply with Group guidelines and providing
support for risk management, especially when local teams lack
suffi cient expertise.
The centralized organization of these support functions enables
consistent dissemination of the major policies and goals of the
general management:
♦
the Financial Planning Department monitors the
Company’s performance using operational monitoring based on
monthly reports from all Group subsidiaries. It also coordinates
meetings between the general management and the operational
and fi nance departments at which the various reporting indicators
are reviewed and the differences between actual performance
and initial forecasts are analyzed, enabling the quarterly, interim,
annual and multiannual forecasts to be fi ne-tuned on the basis
of actual fi gures and market outlooks as received from local and
operational teams. The fi nancial controllers monitor the whole
fi nancial reporting cycle and constantly query subsidiaries on their
performance levels, earnings and business activity. They then
defi ne and distribute the fi nancial objectives for the current
fi nancial year. The Financial Planning Department also carries
out a biannual in-depth review of the multiannual forecasts,
ensuring consistency with the strategic decisions made by the
Group. For these purposes, the Financial Planning Department
regularly performs an alignment of management processes and
improves its management tools, in addition to establishing
defi ned management standards with the Information Systems
Department so as to provide a common, clear language for all
employees to work with;
♦ the role of the Consolidation Department is to monitor
standards, to defi ne the Group’s accounting policies, to produce
and analyze the consolidated fi nancial statements and to prepare
the accounting and fi nancial information. This department is the
main point of contact with the Statutory Auditors during annual
and half-yearly audits.
The IFRS accounting standards applicable to the Group are
identifi ed by the Consolidation Department and systematically
distributed via the online accounting policies manual accessible
by all accounting and fi nancial services. Technical monitoring is
carried out by the team that organizes and manages the updating
process via instructions and/or training.
The Consolidation Department centralizes all expertise on
the preparation and analysis of the Group’s monthly, interim
and annual consolidated fi nancial statements. It audits the
accounting information received from subsidiaries, checks its
compliance with the accounting policies manual and performs
reconciliations to ensure the standardization of procedures.
A detailed report is sent to the management team each month so
that the Group’s performance may be monitored and analyzed.
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 fl ow management at
French and foreign subsidiaries, in particular by overseeing the
dissemination of cash pooling solutions and cash fl ow projections.
It checks the suitability and compatibility of exchange rate and
liquidity risk management policies, as well as the fi nancial
information published. It also manages off-statement of fi nancial
position commitments (bank guarantees relating to purchase
fi nancing, comfort letters, share price guarantees, deposits, etc.).
It centralizes and verifi es the authorization granted to a limited
number of employees, who are exclusively authorized by the
general management to handle certain fi nancial transactions –
subject to pre-defi ned 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 in close collaboration
with the Legal Department. The Acquisitions Department
examines and assesses the strategic interest of the planned total or
partial takeover of a company and submits the relevant proposal
to the general management, which makes the fi nal decision. No
Group subsidiary can make this decision on its own;
♦ the Legal Departments are specialists in all legal business
matters and particularly in acquisition law, company law, contract
law, tax law, employment law and intellectual property law.
They are responsible for developing innovative legal solutions
that comply with current regulations in the various countries
in which Ubisoft operates. Working in close partnership with
the operational teams, the lawyers work upstream to identify
the best strategy, to assess and manage risks and to provide
support in implementing said solutions. The legal teams provide
support to all subsidiaries with regard to their legal issues and
are involved at every stage of their projects (from concept and
production to marketing and distribution). They coordinate
external growth operations, prepare and implement strategies
and contractual relations (particularly in the development of
- Registration Document 2016
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