Siemens 2010 Annual Report Download - page 91

147 Consolidated Financial Statements 49 Combined management’s discussion and analysis 261 Additional information
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The Audit Committee comprises the Chairman of the Super-
visory Board, two of the Supervisory Board’s shareholder rep-
resentatives and three of the Supervisory Board’s employee
representatives. Under German law, the Audit Committee must
include at least one independent member of the Supervisory
Board who has knowledge and experience in the application of
accounting principles or the auditing of financial statements.
The Chairman of the Audit Committee, Dr. Hans Michael Gaul,
satisfies these German statutory requirements. The Super-
visory Board has designated Dr. Gaul – in addition to Dr.
Gerhard Cromme – as an “audit committee financial expert,”
as defined by the regulations of the SEC adopted pursuant to
Section  of the SOA. The Audit Committee oversees the ac-
counting process. Furthermore, in addition to the work per-
formed by the independent auditors, the Audit Committee
discusses the Company’s financial statements prepared quar-
terly, half-yearly and annually by the Managing Board. On the
basis of the independent auditors’ report on the annual finan-
cial statements, the Audit Committee makes after its own re-
view recommendations to the Supervisory Board about
whether or not to approve the annual stand-alone financial
statements of Siemens AG and the Consolidated Financial
Statements of Siemens. It concerns itself with the Company’s
risk monitoring system and oversees the effectiveness of the
internal control system, in particular as it relates to financial
reporting, the risk management system and the internal audit
system. The internal corporate audit unit reports regularly to
the Audit Committee. In addition, the Audit Committee moni-
tors the independent audit of financial statements, including
in particular the independence and qualifications of the inde-
pendent auditors as well as the independent auditors’ services,
and performs the other functions assigned to it under the SOA.
The Compliance Committee comprises the Chairman of the
Supervisory Board, two of the Supervisory Board’s shareholder
representatives and three of the Supervisory Board’s employee
representatives. The Compliance Committee monitors the
Company’s adherence to statutory provisions, official regula-
tions and internal Company policies.
The Nominating Committee, which comprises the Chairman
of the Supervisory Board and two of the Supervisory Board’s
shareholder representatives, is responsible for making recom-
mendations to the Supervisory Board’s shareholder representa-
tives on the shareholder candidates for election to the Super-
visory Board by the Annual Shareholders’ Meeting. In preparing
these recommendations, it shall take into consideration that
the candidates must possess the knowledge, abilities and ex-
perience needed to perform their duties and that they must be
independent, and it shall also pay attention to diversity and in
particular to an appropriate participation of women.
The Mediation Committee, comprising the Chairman of the
Supervisory Board, the First Deputy Chairman (who is elected
in accordance with the German Codetermination Act), one of
the Supervisory Board’s shareholder representatives and one
of the Supervisory Board’s employee representatives, submits
proposals to the Supervisory Board in the event that the Super-
visory Board cannot reach the two-thirds majority required for
the appointment or dismissal of Managing Board members.
The Finance and Investment Committee comprises the Chair-
man of the Supervisory Board, three of the Supervisory Board’s
shareholder representatives and four of the Supervisory
Board’s employee representatives. It shall – based on the Com-
pany’s overall strategy, which is the focus of an annual strategy
meeting of the Supervisory Board – prepare discussions and
resolutions of the Supervisory Board on questions relating to
the financial situation and structure of the Company as well as
on fixed asset and financial investments. In addition, the
Supervisory Board has delegated the authority to decide on the
approval of transactions and measures, which would require
the approval of the Supervisory Board, but the value of which
is below € million, to the Finance and Investment Commit-
tee. The Finance and Investment Committee also exercises the
rights of the Supervisory Board pursuant to §  of the German
Codetermination Act to make decisions regarding the exercise
of ownership rights resulting from interests in other compa-
nies. §  () sentence  of the German Codetermination Act
sets forth that decisions made by the Finance and Investment
Committee pursuant to §  of the German Codetermination
Act only require the votes of the shareholder representatives.
The composition of the Supervisory Board and its committees
is presented on pages  ff. of this Annual Report. Informa-
tion on the work of this body is provided by the Report of the
Super visory Board on pages  ff. Details of the compensation
paid to the members of the Supervisory Board are given com-
prehensively in the Compensation report on pages  ff.