APC 2004 Annual Report Download - page 33

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Reviews the internal audit organization and
resources, as well as the internal audit program and
the executive summary of the internal auditors'
reports.
Examines proposed dividend distributions and the
amount of financial authorizations submitted for
shareholders' approval at the Annual Meeting.
The Audit Committee examines all financial, account-
ing and risk management issues referred to it by the
Board of Directors or its Chairman.
In addition, prior to the Committee's review of the
annual and interim financial statements, the Audit
Committee Chairman meets with the Auditors alone,
without any Company representatives present. The
Audit Committee Chairman also meets with the head
of Internal Audit four times a year without any other
Company representative present.
The Audit Committee presents its findings and rec-
ommendations to the Board and distributes the min-
utes of its meetings to the Directors.
Meetings in 2004
In 2004, the Audit Committee met four times under
the chairmanship of Gérard de La Martinière. The
average duration of the meetings was 2 hours and 30
minutes and the average attendance rate was 94%.
Each meeting was also attended by members of the
Finance Department, the head of Internal Audit and
the Auditors.
The Audit Committee reviewed the annual and interim
financial statements, and the work of the internal and
external Auditors. With the two Auditors' terms due to
expire at the Annual Shareholders' meeting of May 6,
2004 and after inviting selected audit firms to submit
service proposals, the Committee recommended to
the Board that an auditor rotation policy should be
adopted (see above).
In connection with its risk review, the Committee
examined the Company's environmental policy, the
status of operations in France, information systems
outsourcing and globalization, and procedures for the
integration of newly-acquired businesses. It also ana-
lyzed the Company's dividend and share buyback pol-
icy in relation to the structure of shareholders' equity
and made recommendations to the Board on this sub-
ject.
The Committee examined the impact on the
Company's accounts of the transition to International
Financial Reporting Standards (IFRS) and obtained
information about the measures taken by the
Company to ensure a smooth transition.
The Committee reported to the Board on its activities
in 2004 at the Board meetings held on February 19,
July 28 and December 9, 2004.
Remunerations and
Appointments Committee
Members
Since February 2004, the Remunerations and
Appointments Committee has been made up of
Michel François-Poncet, Chairman, René Barbier de
La Serre, Willy Kissling and Henri Lachmann.
On February 16, 2005, the Board of Directors
appointed Mr. Barbier de La Serre Chairman to
replace Mr. François-Poncet, who has passed away,
and appointed Claude Bébéar to serve as a member.
Responsibilities
The Committee is regularly informed of the Group's
compensation policies, especially executive compen-
sation. It reviews stock option plans and employee
stock purchase plans decided by the Board. It makes
recommendations to the Board concerning the nomi-
nation of candidates for election as Directors, the
appointment of members of Board Committees and
the compensation of the Chairman, which comprises
a variable component partially linked to the achieve-
ment of personal and performance objectives. The
Chairman is not present when his compensation is
discussed. The Committee sets independence criteria
for Directors and examines their situation with respect
to these criteria.
It recommends the amount of attendance fees for
approval at the Annual Meeting and their allocation
among Directors. It is also responsible for preparing a
succession plan for the Chairman and examines suc-
cession planning solutions for members of the
Direction and Strategy Committee and the Operations
Committee.
The Remunerations and Appointments Committee
presents its findings and recommendations to the
Board and distributes the minutes of its meetings to
the Directors.
Meetings in 2004
The Remunerations and Appointments Committee
met three times in 2004, with an average attendance
rate of 83%. It reported to the Board on its activities at
the Board meetings held on February 19, March 17
and December 9, 2004.
It made recommendations to the Board concerning
the Board's membership and the Chairman's com-
pensation. The Chairman was not present when the
Board discussed this latter topic. The Committee also
devoted time to considering the Chairman's succes-
sion. Lastly, it recommended that the Board set up two
new option plans (23 and 24) and issue shares to
employees under the 2004 worldwide Employee
Stock Purchase Plan.
Corporate Governance