Siemens 2011 Annual Report Download - page 241

153 D. Consolidated Financial Statements
273 E. Additional information
143 C. Additional information for supplemental
financial measures
145 C. Siemens AG (Discussion on basis of
German Commercial Code)
151 C. Notes and forward-looking statements
140 C. Information required pursuant to Section  ()
and Section  () no.  of the German Commer-
cial Code (HGB) and explanatory report
142 C. Compensation report and Corporate Governance
statement pursuant to Section a of the German
Commercial Code (HGB)

The specialist skills required of employees involved in the ac-
counting process are assessed when the employees are ini-
tially selected; thereafter, the employees receive regular train-
ing. As a fundamental principle, at the different levels, items
must be verified by at least one other person (four eyes prin-
ciple) and specific procedures must be adhered to for the au-
thorization of the data. Additional control mechanisms in-
clude target-performance comparisons and analyses of the
composition of, and changes in, individual line items, both in
the closing data reported by units and in the Consolidated Fi-
nancial Statements.
Accounting-related IT systems provide for defined access
rules in order to ensure that accounting related data is pro-
tected from unauthorized access, use or modification. Every
unit included in our Consolidated Financial Statements is sub-
ject to the rules and regulations of the Corporate Information
Security Guide. This is intended to ensure that IT system users
only have access to those systems and information that they
need to carry out their duties.
On a quarterly basis, management of Sectors, Divisions, SFS,
Cross-Sector Services, regional Clusters and certain Corporate
Units, supported by confirmations of management of entities
under their responsibility, confirm the accuracy of the finan-
cial data they have reported to Siemens’ corporate headquar-
ters and the effectiveness of the related control systems.
In addition, we have set up a Disclosure Committee – compris-
ing selected heads of Corporate Units – which is responsible
for reviewing certain financial and non-financial information
prior to publication.
The Supervisory Board, through the Audit Committee, is also
integrated into our control system. In particular, the Audit
Committee oversees the accounting process, the effective-
ness of the control system, the risk management system and
the internal audit system, and the independent audit of finan-
cial statements. In addition, it conducts an audit of the docu-
ments related to the annual financial statements of Siemens
AG and the Consolidated Financial Statements and discusses
the annual financial statements of Siemens AG, the Consoli-
dated Financial Statements and Management’s discussion
and analysis of these statements with the Managing Board
and the independent auditors.
The activities of our internal corporate audit function form a
further element in the control system. Throughout Siemens
and on a continuous basis, the Siemens’ internal corporate
audit function carries out audits with respect to the compli-
ance with guidelines and the reliability and functional opera-
tion of our control system as well as the adequacy and effec-
tiveness of our risk management system.
In addition, and in accordance with the requirements of the
Sarbanes-Oxley Act, we have rules for accounting-related
complaints and a Code of Ethics for Financial Matters to be
certified by the Chief Executive Officer, the Chief Financial Of-
ficer, and the Head of our Financial Reporting and Controlling
department, as well as other senior financial personnel con-
cerned with the financial closing process.
C.. Additional information related
to the separate financial statements
(HGB) of Siemens AG
Siemens AG as the parent company of the Siemens Group is
integrated into the company-wide accounting-related internal
control system described above. Generally, the information
set out above also applies for Siemens AG’s separate financial
statements prepared in accordance with the German Com-
mercial Code (HGB).
The Consolidated Financial Statements are prepared in accor-
dance with IFRS. Where required, i.e. for purposes of prepar-
ing statements for local regulatory or tax purposes, data is ad-
opted in accordance with relevant national regulations by
means of reconciliation at account level. Accordingly, accu-
rately determined IFRS closing data also forms an important
basis for the separate financial statements of Siemens AG. In
the case of Siemens AG and other group companies required
to prepare financial statements in accordance with HGB, the
conceptual framework described above is complemented by
our mandatory HGB closing guidelines and an HGB chart of
accounts.
The manual and system-based control mechanisms referred
to above generally also apply when reconciling the IFRS clos-
ing data to the separate HGB financial statements. The infor-
mation relating to the systematic monitoring of the design
and operating effectiveness of the accounting-related internal
control system applies only to the Consolidated Financial
Statements in accordance with IFRS.