2011 Registration Document - Imerys

4 Internal
RISK FACTORS AND INTERNAL CONTROL
control
Control activities concerning the accuracy
of accounting and financial information
The control mechanism and the procedures for the production of
the accounting and financial information are uniform throughout the
Group. This mechanism is made up of a cross-Group accounting
organization, consistent accounting standards, a single consolidated
reporting system and a quality control of the financial and accounting
information that is produced.
Organization of the a ccounting and f inancial
operations
Accounting and financial operations are managed by the Group
Finance Function. Its central organization includes:
p an a ccounting and c onsolidation d epartment, which is responsible
for the preparation and presentation of Imerys’ statutory financial
statements and the Group’s consolidated financial statements;
p a f inancial c ontrol and b udget c ontrol d epartment, which prepares
and compiles budget and monthly management reporting data
and analyzes operations’ performance in relation to budget
targets and to comparable periods during the previous year;
p a t r easury and f i nancing d epartment, which is particularly in
charge of preparing and consolidating data on financial debt
and on the Group’s financial income/expense. Its main missions
concern the centralized management and optimization of the
Group’s debt and financial resources and management of interest
rate, liquidity and currency risk, as well as the management of
hedging instruments;
p a t ax d epartment, which monitors the tax consolidations made
in the Group, estimating the resulting amount of taxes and
controlling their overall consistency.
Because of the decentralized organization of accounting and financial
functions, the financial controller of each activity has a key role. In
particular, he or she is in charge of making sure that the accounting
framework and all the accounting and financial internal control
procedures are correctly applied in the activities for his or her scope
of responsibility. Each controller is assigned to the manager of the
operating entity in question, but also reports on a functional basis
to the Group Finance Function.
130 2011 REGISTRATION DOCUMENT IMERYS
Accounting framework
The general accounting rules are described in the “Blue Book” which
may be consulted online via intranet. They apply to all the Group’s
operating and legal entities. In compliance with the IFRS standards
adopted within the European Union, they include:
p a reminder of the general accounting principles and
recommendations to comply with;
p a detailed chart of accounts;
p a definition of the Group’s accounting methods that apply for the
most important items and/or operations.
These documents are regularly updated with every amendment or
application of new accounting standards, under the responsibility of
the Reporting & Consolidation Department and under the control of
the Statutory Auditors.
Annual budget and management reporting
Every year, Imerys implements a monthly reporting and budget
process for all the Group’s entities in order to have a running tool and
accurate and consistent information. The match between accounting
data and the management information derived from reporting is the
key control principle intended to ensure the accuracy of accounting
and financial information.
Imerys’ budget preparation procedure is based on the involvement
of crossfunctional teams in every activity and on the control of the
overall consistency of assumptions and methods by the Reporting
& Consolidation Department.
The reporting system enables the Group to accurately monitor
monthly results (income statement and cash flow) and financial
data for operating activities and to compare them with the budget
and results for the corresponding period in the previous financial
year. Local line managers comment on management indicators and
the main variations are analyzed by the Reporting & Consolidation
Department.
Consolidation process
A single accounting consolidation system handles all information
from every Group operating and legal entity.
To guarantee the quality and accuracy of its financial information,
Imerys has set up a “SAP Business Object Financial Consolidation”
unified reporting and consolidation system for both the collection of
management information and production of the consolidated financial
statements. The system is deployed in all the Group’s entities. It is
sourced from local accounting data by interface, by retrieving the
necessary data from the financial modules of entities’ ERP systems
or by manual input. The system provides for the automatic control
of certain reported and/or consolidated data.
A detailed schedule is drawn up for annual and interim (quarterly
and semi-annual) account closings by the Reporting & Consolidation
Department.