APC 2002 Annual Report Download - page 31

Corporate Governance
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As a result, it:
Prepares the Board’s review of the annual and interim
financial statements. In particular, it:
- Ensures that accounting methods used to prepare the
consolidated and parent company financial statements
are appropriate and applied consistently, that all significant
transactions are properly reflected in the consolidated
financial statements and that the rules governing the
scope of consolidation are correctly applied.
- Analyzes risks, off-balance sheet commitments
and the cash position.
Reviews draft versions of the annual and interim reports.
Makes recommendations, following consultation, concerning
the renewal or appointment of the Auditors.
Examines the scope of audit engagements and the results of
audits. It makes sure the Auditors have acted independently,
notably when reviewing fees paid by the Group to their firm
and network.
Reviews the internal audit organization and resources, as
well as the internal audit program and the general summary
of reports submitted by the internal auditors.
Examines proposed distributions and the amount of financial
authorizations submitted for approval to shareholder
approval at the Annual Meeting.
The Audit Committee examines all financial, accounting
and risk management issues submitted to it by the Board
of Directors or its Chairman.
In addition, every year, before the Committee has reviewed
the financial statements, the Audit Committee Chairman meets
with the Auditors alone, without any Company representatives
present.
The Audit Committee presents its findings
and recommendations to the Board.
c. Meetings in 2002
In 2002, the Audit Committee met three times under the
chairmanship of Gérard de La Martinière, with an attendance
rate of 100%. Each meeting was also attended by members
of the Finance Department and the Auditors. When reviewing
the proposed ruling on the 2001 financial statements,
the Committee was also addressed by the accounting firm
Salustro Reydel, responsible for exercising Schneider Electric’s
equity claims in Legrand.
The Audit Committee reviewed the annual and interim financial
statements and the internal audit process. The Committee also
examined and verified the appropriateness of the accounting
rules applied by Schneider Electric in respect to the scope of
consolidation and off-balance sheet commitments, in light of
lessons learned from the Enron case. It analyzed the treatment
of goodwill (valuation and accounting principles) and
the impact of pension and post-retirement healthcare
commitments, primarily in respect to US employees.
The Committee reviewed procurement principles and
procedures. It examined Company actions in the area of
sustainable development and their presentation in the annual
report. Lastly, it was informed of the measures taken by
the Auditors in response to the COB’s recommendation
concerning the rotation of audit partners.
The Committee presented its findings to the Board on
February 26, 2002, September 4, 2002 and February 5, 2003.
Remunerations and Appointments Committee
a. Members
From January 1 to October 23, 2002, the Remunerations and
Appointments Committee comprised:
MM. Claude Bébéar, Chairman,
Jean-René Fourtou,
Michel François-Poncet,
Henri Lachmann.
The Committee’s current members are:
MM. Michel François-Poncet, Chairman,
Claude Bébéar,
René Barbier de La Serre,
James Hardymon,
Henri Lachmann.
b. Responsibilities
The Committee is regularly informed of the Group’s
compensation policies, especially executive compensation.
It reviews stock option plans and employee stock ownership
plans decided by the Board. It also makes recommendations
to the Board concerning the nomination of Directors, the
appointment of members of Board Committees and the
compensation of the Chairman, which comprises a variable
component partially linked to the achievement of personal
and performance objectives. In the last case, it meets
without the Chairman.