Values

156 Report of the Supervisory Board
Th ese focused above all on the impact of the general decline
of Bertelsmann’s core markets during the fi scal year, in particular
the weak advertising markets, on the businesses and the
progress of the successful countermeasures that were implemented.
Th e Supervisory Board also looked at the management
development structure within the Group and its elements.
In implementing new legal provisions (VorstAG – Act on the
Appropriateness of Management Board Remuneration) and
the recommendation of the German Corporate Governance
Code the Supervisory Board, in the absence of the Executive
Board, addressed the system of remuneration for the Executive
Board and approved it.
In fi scal year 2009, the Supervisory Board convened for four
regular meetings. During the period under review the Strategy
and Investment Committee and the Personnel Committee
each met four times. Th e Audit and Finance Committee met
seven times, including conference calls. Th e Working Group of
Employee Representatives on the Supervisory Board convened
four times. Between meetings, the Supervisory Board was notifi
ed in writing of projects and plans of special relevance and
urgency for the company, and its opinion and or decision on
matters was sought where necessary.
Th e Supervisory Board Chairman maintained ongoing contact
with the Executive Board outside the framework of Supervisory
Board meetings, in particular with the Executive Board Chairman,
in order to stay abreast of the current business situation,
signifi cant transactions and the progress of the cost-cutting
measures. During a full-day meeting with the Executive Board,
the Supervisory Board discussed in detail fundamental issues of
strategic Group development and the alignment of the Group
portfolio in terms of market prospects, positioning for the future
and competitive situation. All Supervisory Board members
attended at least half of the meetings convened and no potential
confl icts of interest arose in the Supervisory Board.
Th e Supervisory Board addressed the German Corporate
Governance Code and Bertelsmann’s compliance therewith.
A joint report by the Supervisory and Executive Boards on
corporate governance at the company is provided on page
152 ff . of this management report. As a non-listed company,
Bertelsmann opted not to issue a formal declaration of compliance
as per section 161 of the German Stock Corporation Act.
Th e Supervisory Board subjected its work to a routine evaluation
in fi scal year 2009. Th e comprehensive process resulted in
a positive evaluation of the work of the plenary session and the
Committees. As part of an ongoing process of further development,
a number of suggestions were identifi ed, some of which
have already been implemented.
Audit of the Annual and Consolidated
Financial Statements
KPMG AG Wirtschaftsprüfungsgesellschaft, Berlin, (formerly
KPMG Deutsche Treuhand-Gesellschaft Aktiengesellschaft
Wirtschaftsprüfungsgesellschaft) audited the annual and
consolidated fi nancial statements produced by the Executive
Board for the fi scal year January 1 through December
31, 2009, as well as the Bertelsmann AG management and
Group management reports dated December 31, 2009, each
of which received an unqualifi ed auditor’s opinion. Th e annual
fi nancial statements were produced in accordance with HGB
(German Commercial Code), and the Bertelsmann AG consolidated
fi nancial statements were produced in accordance
with the International Financial Reporting Standards (IFRSs)
as applicable in the European Union in line with section 315a
HGB. Th e Supervisory Board’s Audit and Finance Committee
had mandated the auditor of the annual fi nancial statements
and consolidated fi nancial statements in accordance with the
Annual General Meeting resolution. Th e Audit and Finance
Committee determined impairment testing of intangible assets
acquired through acquisitions and of goodwill as a particular
audit focus. Th e auditor performed the audit in observance of
German accepted auditing principles established by the German
Institute of Independent Auditors (IDW). Th e auditor was
additionally instructed to audit Bertelsmann AG’s Risk Early
Warning System, which it found to be satisfactory as per section
91 (2) of the German Stock Corporation Act. Th e auditor
of the annual and consolidated fi nancial statements promptly
submitted fi nancial statement documents and the audit report
to the Supervisory Board by the specifi ed deadline in advance
of the fi nancial review meeting.
Bertelsmann Annual Report 2009