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financial statements 2011
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earnings or 20–30 percent of the annual taxable earn-
ings of other key personnel. The bonuses accumulated
in the old system can be withdrawn in stages over a
three-year period starting from 2010. The bonuses
accumulated in the new system can be withdrawn in
stages over a three-year period starting from 2013.
Furthermore, the business areas can apply bonus
systems based on sales or production or linked to the
units’ contributions to the profit margins or their earn-
ings to facilitate business success. These systems do not
overlap with the Group’s annual performance-based
bonus system.
Upon termination of their contracts, the CEO and
other members of the Group Management Team will
be entitled to the salary paid for the period of notice
as well as benefits. The period of notice for terminat-
ing the ceo’s employment is six months when notice
is served by the employer and four months when
notice is served by the ceo. The period of notice for
terminating the employment of other members of
the Group Management Team is between six and 12
months when notice is served by the employer and
between three and six months when notice is served
by the corporate executive in question. Upon termina-
tion of employment by the employer, the ceo will be
entitled to compensation equivalent to six months’
salary in addition to the salary paid for the period of
notice, and other members of the Group Management
Team will be entitled to compensation equivalent to up
to six months’ salary in addition to the salary paid for
the period of notice. Upon resignation, the corporate
executive in question will only be entitled to the salary
paid for the period of notice as well as benefits.
The CEO’s retirement age is 62 years. With the
exception of the ceo and the Chief Financial Officer,
Edita Plc does not provide supplementary pension in-
surance. The supplementary pension plans of the ceo
and the Chief Financial Officer are based on contribu-
tions and they include vested rights.
Financial reporting
The achievement of financial targets and balance
sheet management are monitored through monthly
Group-wide reports. Interim financial statements are
drawn up quarterly. A semi-annual review is drawn up
together with the interim financial statements for the
first half-year.
Risk management
The risk management policy approved by Edita’s Board
of Directors defines the risk management principles,
objectives, and divisions of responsibility in the Group.
Risk management is based on an organization-wide
approach to identifying, assessing, managing, and
monitoring material risks. The ceo and other execu-
tives ensure that risk management is a continuous,
integral part of the Group’s day-to-day operations. The
management reports to the Board on risks by business
area. Unless there is need for ad-hoc reporting, the
management reports to the Board on risks on a quar-
terly basis. The ceo and other executives identify and
monitor risks, develop and c-ordinate risk management
activities, and update the Group’s risk profile. The
Board of Directors deals with the most significant risks
and evaluates the efficiency of risk management at
least once a year. The effectiveness of Edita’s risk man-
agement is monitored through internal and external
audits as part of the regular auditing program.
Auditing
The authorized public accountant firm elected by the
Annual General Meeting to audit the parent company,
Edita Plc, audits the entire Group with regard to ac-
counting, financial statements, and administration each
financial year. In addition to the audit report issued in
connection with the company’s financial statements,
the auditors also regularly report on their findings to
the Board’s Audit Committee.
Edita’s Auditor is kpmg Oy, with Minna Riihimäki,
apa, acting as the auditor in charge in 2011.
Internal auditing
The purpose of internal control and risk management
is to ensure that the company’s operations are efficient
and profitable, that the supply of information is reli-
able, and that regulations and policies are observed.
Internal auditors are responsible for helping the Board
and the ceo to assess the appropriateness and ef-
fectiveness of the Group’s processes and systems, the
efficiency and adequacy of internal control, and the
accuracy and adequacy of accounting and reporting.
In the Edita Group, internal auditing goals are
decided upon annually by the Board by means of risk
assessments, etc. Practical implementation is entrusted
to an independent external firm of authorized public
accountants.
Internal audit reports are distributed to Edita Plc’s
Board of Directors, Audit Committee, auditors, ceo,
and Group Management Team. The ceo, together with
other executives, is responsible for ensuring that any
actions required on account of observations made by
internal auditors are duly initiated.
Edita’s internal auditing was performed by bdo Oy,
in 2011.