2011 Annual Report - OTCIQ.com

192 Supervisory Board and Board of Management
At its two meetings, the Nomination Committee prepared the
recommendation for the Annual Shareholders Meeting for
the election of three shareholder representatives (Baroness
Denise Kingsmill, Bård Mikkelsen, and René Obermann) to
the E.ON AG Supervisory Board.
The Mediation Committee pursuant to Section 27, Paragraph
3, of the Codetermination Act did not meet in 2011.
The Finance and Investment Committee held four meetings.
The matters addressed by the committee included the sale of
E.ON’s power distribution network in the United Kingdom and
an opportunity to acquire a shareholding (which ultimately was
not implemented) in conjunction with the privatization of
Portugal’s energy industry. It also dealt conclusively with the
planning for 2011 and dealt in detail with the medium-term
plan for the period 2012–2014. The committee’s thorough discussions
and the Board of Management’s comprehensive
reports focused on issues relating to corporate finance, the
investment plan, and the Company’s rating situation. At its
meetings, the committee also prepared Supervisory Board resolutions
on trans actions requiring the Supervisory Board’s
approval and on the medium-term plan.
The Audit and Risk Committee met six times. With due attention
to the independent auditors’ audit report and in discussions
with the independent auditors, the committee devoted particular
attention to the Financial Statements of E.ON AG (prepared
in accordance with the German Commercial Code) and
the E.ON Group’s Consolidated Financial Statements and
Interim Reports (prepared in accordance with International
Financial Reporting Standards, or “IFRS”). The Interim Reports
for 2011 were thoroughly discussed prior to their release. The
committee discussed the recommendation for selecting
independent auditors for the 2011 financial year and assigned
the tasks for their auditing services, established the audit
priorities, determined the independent auditors’ compensation,
and verified their qualifications and independence in line
with the Code’s recommendations. The committee assured
itself that the independent auditors have no conflicts of
interest. Topics of particularly detailed discussions included
issues relating to accounting, the internal control system,
and risk management in relation to the accounting process.
In addition, the committee thoroughly discussed the Combined
Group Management Report and the proposal for appropriating
income available for distribution and prepared
the relevant recommendations for the Supervisory Board and
reported to the Supervisory Board. In this context, the committee
also discussed in detail the progress of significant investment
projects as well as the results of the goodwill impairment
tests and the necessary impairment charges. Other matters
dealt with by the committee included the testing and quality
control of E.ON’s risk management system. The committee
focused on the Company’s risk-monitoring organization as well
as its risk situation and ability to bear risk, in particular with
regard to counterparty, liquidity, country, market and operational
risks. It did this by working with the independent auditors
and by examining documents that included reports from
the Company’s risk committee. The committee also discussed
the work done by internal audit including the audit plan in 2011
and the audit priorities for 2012. Furthermore, the committee
discussed the compliance report and E.ON’s compliance system,
and other issues related to auditing. The Board of Management
also reported on ongoing proceedings and on legal and
regulatory risks for the E.ON Group’s business.
Examination and Approval of the Financial Statements
of E.ON AG, Approval of the Consolidated
Financial Statements, Proposal for Appropriating
Income Available for Distribution
PricewaterhouseCoopers Aktiengesellschaft, Wirtschaftsprüfungsgesellschaft,
Düsseldorf, the independent auditors
chosen by the Annual Shareholders Meeting and appointed
by the Supervisory Board, audited and submitted an unqualified
opinion on the Financial Statements of E.ON AG and
the Combined Group Management Report for the year ended
December 31, 2011. The Consolidated Financial Statements
prepared in accordance with IFRS exempt E.ON AG from the
requirement to publish Consolidated Financial Statements in
accordance with the German Commercial Code.
Furthermore, the auditors examined E.ON AG’s risk detection
system. This examination revealed that the Board of Management
has taken appropriate measures to meet the requirements
of risk monitoring and that the risk detection system
is fulfilling its tasks.
At our meeting on March 13, 2012, we examined—in the presence
of the independent auditor and with knowledge of,
and reference to, the Independent Auditor’s Report and the
results of the preliminary review by the Audit and Risk Committee—the
Financial Statements of E.ON AG, the Consolidated
Financial Statements, the Combined Group Management
Report, and the Board of Management’s proposal regarding
the appropriation of net income available for distribution.
The independent auditor was available for supplementary questions
and answers. We found no reasons, including after the
conclusion of our examination, for objections regarding these
documents. We therefore noted with approval the Independent
Auditor’s Report.
We approved the Financial Statements of E.ON AG prepared by
the Board of Management and the Consolidated Financial Statements.
The Financial Statements are thus adopted. We agree
with the Combined Group Management Report and, in particular,
with its statements concerning E.ON’s future development.