2014 Registration Document and Annual Financial Report - page 120

Corporate GOVERNANCE
Report of the Chairman of the Board of Directors
3
Procedure manuals and accounting principles
The Finance Manual issued to all Finance Departments within the
Group describes the closing process for the monthly management
accounts and sets out the Group’s charts of accounts, consolidation
principles, accounting standards and policies. It also addresses
specific issues related to the investment approval procedure and
includes theTreasury Charter, which describes cash management
procedures, the principles to be followed concerning the holding
of payment instruments and the approval of expenditures, as well
as the role and organization of cash pooling systems. Employees
can download the manual from the Group’s Intranet.
In addition, a presentation of International Accounting Standards/
International Financial Reporting Standards, providing details on
how to apply the standards to the Group’s specific circumstances,
has been prepared by Group Finance and provided to the Group
employees concerned.
Lastly, consolidation instructions detailing the financial reporting
schedule and specific points concerning consolidation adjustments
to individual financial statements are issued once every six months
to the various Finance Directors and consolidation teams, and are
archived on the Finance Intranet.
Internal procedure manuals
Internal procedure manuals have been produced for the main
businesses.The purpose of these manuals is to structure and firmly
establish Group procedural guidelines, based on an assessment of
the specific internal control risks of each business.
Internal control procedures are implemented under the direct
responsibility of the operating divisions and corporate functions
and form part of an ongoing process of identifying, assessing and
managing risks.
Internal control self-assessments
The Group places considerable emphasis on preparing, issuing
and monitoring internal control self-assessment procedures, which
have now been rolled out to the majority of hotel operating units
and head offices.These procedures interconnect with the Group’s
existing internal control standards and processes and are based on
analyzing the internal control risks inherent in each business and
identifying key control issues.
Data obtained from the internal control self-assessment process
are periodically centralized at Division level, with the assistance of
the internal auditors when required.
Internal Audit programs for units where the self-assessment
system has been deployed include a quantitative measurement,
via
a rating system, of the gap between the self-assessment and
the internal auditors’ assessment of the level of internal control.
By analyzing these gaps, it is possible to evaluate the quality of the
self-assessment procedures implemented by the unit manager.
Internal Audit reports
A draft report is prepared after each Internal Audit, setting out
observations, identified risks and recommendations. This report is
sent to the management of the audited unit, which prepares an
action plan when required. A summarized version of this draft report
is also sent on request to the members of the Executive Committee.
The final report, which includes any corrective action plans prepared
by the audited unit, is then sent to the managers in charge of
overseeing operational and financial matters for the unit concerned.
The reports prepared by the local Internal Audit Departments
are centralized by the Corporate Internal Audit Department and a
summary of the work performed by these departments is presented
to the Group Internal Control Committee.
The Audit and Risks Committee receives a quarterly summary of
the internal audits carried out during the period, including a status
report on the annual audit plan, an assessment of the quality of
internal control in the audited units and the gap between the internal
auditors’ assessments and any self-assessments performed by the
units, as well as the internal auditors’ main observations, and action
plans decided on by the parties concerned.
Reporting procedure
Group Financial Control is responsible for overseeing the reporting
procedure specified in the Finance Manual.The procedure requires
the Divisions to submit monthly reporting packages comprising an
analysis of key business indicators and the main components of
income, in the format prescribed by the Group. All reporting data
submitted by the Divisions must be analyzable both by nature and
by function.
The reporting procedure is designed to provide a detailed analysis
of changes in financial and operating results, which helps the Group
to provide support with resource allocation decisions and measure
the efficiency of the various organizational structures in place.
Registration Document 2014
118
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