Annual report 2005 - Dexia.com

Annual Report 2005ResponsibilitiesThe role of the Audit Committee is, onthe one hand, to review the projects of theannual, quarterly, corporate and consolidatedfinancial statements of the Group in order toverify, from those transmitted documents, inparticular the conditions under which theywere established and to ensure the relevanceand continuity of the accounting principlesand applied methods, and, on the otherhand, to monitor the performance of theinternal control system put in place by theManagement Board and more particularlythe system to manage the risks to which theGroup is exposed as a result of its activities.The Audit Committee has free access to theStatutory Auditors, as well as to the GeneralAuditor and the Chief Compliance Officer.It informs the Chief Executive Officer of anysuch contacts.ActivityIn 2005, the Audit Committee met onFebruary 10 and 24, May 23 and September 5,to review in particular the following issues:• a review of the financial statements and theresults of the Group as of December 31, 2004,March 31, 2005 and June 30, 2005;• the half-year reports on the internal auditactivities in the entities of the Group;• the half-year reports from the GroupRisk Management on risk assessment andmonitoring;• the implementation and impact of the IFRS;• the Compliance situation within the DexiaGroup and the progress of actions in this area;• the independence and compensation ofGroup auditors;• the finalization of the internal rules of theAudit Committee;• the follow-up of the share-leasing file.The annual report on the status of internalcontrol and the 2006-2009 multi-year auditplan and the 2006 annual plans were presentedat the meeting of the Audit Committee onJanuary 13, 2006.The attendance rate of directors at meetingsof this committee was 100% in 2005.Compensation CommitteeMembershipThe Compensation Committee is composedof four non-executive directors who have norelationship that might directly or indirectlyinfluence their judgment. In this respect,careful attention is given to the relations thatexist on the Boards of Directors between theofficers of Dexia and the companies to whichmembers of this committee may belong.If he is not a member, the Chairman of theBoard of Directors attends the meetings ofthis committee. The Chief Executive Officermay also attend meetings, but he may not bea member of the Compensation Committee(since he is not a non-executive director).ResponsibilitiesThe responsibilities of the CompensationCommittee include recommendationsconcerning:• the compensation for the Chairman ofthe Board, and the Chief Executive Officerand, based on the Chief Executive Officer’srecommendation, the compensation for themembers of the Management Board;• the granting of stock options pursuant tothe general principles defined by the Board ofDirectors.It is also consulted on the compensation andincentives for the members of the ManagementBoards of Dexia Bank Belgium, Dexia Crédit115