Philips 2010 Annual Report Download - page 129

11 Supervisory Board report 11.2.10 - 11.3
Annual Report 2010 129
11.2.10 2011
The Remuneration Committee continues to monitor
trends and changes in the market. It keeps a watching brief
on the continuing alignment between Philips’ strategic
objectives and the remuneration policy for the Board of
Management.
11.3 Report of the
Audit Committee
The Audit Committee, currently consisting of four
members, assists the Supervisory Board in fulfilling its
supervisory responsibilities for the integrity of the
Company’s financial statements, the financial reporting
process, the system of internal business controls and risk
management, the internal and external audit process, the
internal and external auditor’s findings and
recommendations, independence and performance, as
well as the Company’s process for monitoring compliance
with laws and regulations and the General Business
Principles (GBP). Moreover, the Audit Committee
evaluates the performance of the external auditor every 3
years, in accordance with the Philips Policy on Auditor
Independence.
The Audit Committee met five times in 2010 and
reported its findings to the plenary Supervisory Board.
The President/CEO, the CFO, the Internal Auditor, the
Group Controller and the External Auditor attended all
regular meetings. Furthermore, the Audit Committee met
each quarter separately with each of the President/CEO,
the Chief Financial Officer, the Internal Auditor and the
External Auditor.
In accordance with its charter, which is part of the Rules of
Procedure of the Supervisory Board, the Audit
Committee in 2010 reviewed the Company’s annual and
interim financial statements, including non-financial
information, prior to publication thereof. It also assessed
in its quarterly meetings the adequacy and
appropriateness of internal control policies and internal
audit programs and their findings.
In its 2010 meetings, the Audit Committee periodically
reviewed matters relating to accounting policies, financial
risks and compliance with accounting standards.
Compliance with statutory and legal requirements and
regulations, particularly in the financial domain, was also
reviewed. Important findings, identified risks and follow-
up actions were examined thoroughly in order to allow
appropriate measures to be taken.
With regard to the internal audit, the Audit Committee
reviewed, and if required approved, the internal audit
charter, audit plan, audit scope and its coverage in relation
to the scope of the external audit, as well as the staffing,
independence and organizational structure of the internal