2012 Registration document and annual financial report - BNP Paribas

2CORPORATEGOVERNANCEReport of the Chairman of the Board of Directors on the manner of preparation and organisationof the work of the Board and on the internal control procedures implemented by the c ompanyReport of the Chairman - Point 4.a2The Financial Statements Committee“The Committee meets at least four times per year.CompositionAt least two thirds of the members of the Financial StatementsCommittee meet the criteria required to qualify as independent,such as it is set by the Board of Directors in accordance with Frenchmarket guidelines concerning corporate governance.No members of the Bank’s Executive Management shall sit on theCommittee.MissionsThe Committee is tasked with analysing the quarterly, half-yearlyand annual financial statements issued by the Bank in connectionwith the closing of financial statements and obtaining furtherexplanations of certain items prior to presentation of the financialstatements to the Board of Directors.The Committee shall examine all matters related to the financialstatements and documents: the choices of accounting principlesand policies, provisions, analytical results, prudential standards,profitability indicators, and all other accounting matters that raisemethodological issues or give rise to potential risks.The Committee shall analyse, at least twice a year, the summaryof the operations and the results of the accounting and financialinternal control based on the information communicated to it byExecutive Management. It shall be briefed of incidents revealed bythe accounting and financial internal control, reported on the basisof the thresholds and criteria defined by the Board of Directors andreports on its findings to the Board of Directors.It is informed by the Chairman of the Board of Directors of anypossible failure to implement corrective measures decided in thescope of the accounting and financial internal control that is broughtto his direct knowledge by the Head of Periodic Control and reportson its findings to the Board of Directors.Relations with the Statutory AuditorsThe Committee shall steer the procedure for selection of theStatutory Auditors, express an opinion on the amount of fees chargedfor conducting the legal auditing engagements and report to theBoard of Directors on the outcome of this selection process.It shall review the Statutory Auditors’ audit plan, together with theirrecommendations and their monitoring.It shall be notified on a yearly basis of the amount and breakdownof the fees paid by the BNP Paribas Group to the Statutory Auditorsand the networks to which they belong, calculated using a modelapproved by the Committee. It shall ensure that the amount or theportion of the audit firms’ revenues that BNP Paribas representsis not likely to compromise the Statutory Auditors’ independence.Its prior approval shall be required for any engagement entailingtotal fees of over EUR 1 million (before tax). The Committee shallapprove, a posteriori, all other engagements, based on submissionsfrom Group Finance. The Committee shall validate Group Finance’sfast-track approval and control procedure for all “non-audit”engagements entailing fees of over EUR 50,000. The Committeeshall receive, on a yearly basis from Group Finance, a report on all“non-audit” engagements carried out by the networks to which theGroup’s Statutory Auditors belong.Each Statutory Auditor shall report on a yearly basis to the Committeeon its internal control mechanism for guaranteeing its independence,and shall provide a written statement of its independence in auditingthe Group.At least twice a year, the Committee shall devote part of a meetingto a discussion with the team of Statutory Auditors, without anymember of the Bank’s Executive Management being present.The committee meets in the presence of the Panel of StatutoryAuditors, to review quarterly, half-yearly and annual financialstatements.However, the Statutory Auditors shall not attend all or part ofCommittee meetings dealing with their fees or their re-appointment.The Statutory Auditors shall not attend all or part of Committeemeetings dealing with specific issues that concern a member oftheir staff.Except in the event of exceptional circumstances, the files containingthe quarterly, half-yearly and annual results and financial statementsshall be sent to Committee members at the latest on the Friday orSaturday morning preceding Committee meetings scheduled for thefollowing Monday or Tuesday.Where questions of interpretation of accounting principles arisein connection with quarterly, half-yearly and annual results, andinvolve choices with a material impact, the Statutory Auditors andGroup Finance shall submit, on a quarterly basis, a memorandum tothe Committee analysing the nature and significance of the issues atplay, presenting the pros and cons of the various possible solutionsand explaining the rationale for the choices ultimately made.The Committee shall review the draft report of the Chairmanon internal control procedures relating to the preparation andprocessing of accounting and financial information.HearingsWith regard to all issues falling within its jurisdiction, the Committeemay, as it sees fit, and without any other member of ExecutiveManagement being present if it deems this appropriate, interviewthe Heads of Group Finance and Accounting, as well as the Head ofAsset/Liability Management.The Committee may ask to hear from the Head of Group Finance withregard to any issue within its jurisdiction for which it may be liable,or the Bank’s management may be liable, or that could compromisethe quality of financial and accounting information disclosed by theBank.”602012 Registration document and annual financial report - BNP PARIBAS