AXWAY_REGISTRATION_DOCUMENT_2017

AXWAY GROUP AND ITS BUSINESS ACTIVITIES

CORPORATE RESPONSIBILITY

CORPORATE GOVERNANCE

CONSOLIDATED FINANCIAL STATEMENTS

2017 ANNUAL FINANCIAL STATEMENTS

CAPITAL AND AXWAY SOFTWARE STOCK

INFORMATIONS ADMINISTRATIVES ETbJURIDIQUES

COMBINED GENERAL MEETING OFb6bJUNEb2018

Report of the Board of Directors on corporate governance and internal control

e. Ongoing supervision of the internal control system Internal supervision system The supervision of the internal control system is a responsibility shared by all employees and is subject to a continuous improvement process. Executive Management, which oversees the internal control and risk management system, also plays a key role in this area and helps ensure its effectiveness is maintained. Internal audit Pursuant to the internal audit charter adopted by the Company, this system, which has three employees, has the following duties: ● the independent and objective evaluation of the functioning of the internal control system via a periodic audit of entities or the Company’s business areas; ● the development of all recommendations to improve the Company’s operations; ● monitoring the implementation of corrective actions agreed upon following each audit; The audit duties and the associated recommendations aim to reduce the risks identified and improve internal control and procedures, in order to help achieve the strategic objectives of the Company. The internal audit unit is under the authority of the Chief Executive Officer and has direct access to the Chairman of the Board of Directors. The internal audit plan is built upon the priorities adopted for the year, based on the risk map. It is submitted to the Chief Executive Officer and the Audit Committee for approval. Board of Directors (Audit Committee) On behalf of the Board of Directors, the Audit Committee is aware of the main characteristics of the internal control and risk management procedures adopted and implemented by the Executive Management to manage risks: organization, roles and duties of key persons, the process, risk reporting structure and control system monitoring procedure. In particular, it gains an overall understanding of the procedures relating to the preparation and processing of accounting and financial information. The Audit Committee keeps close track of internal audit activities by: ● updating of the risk map. ● approving the annual internal audit plan previously validated by the Executive Management; ● monitoring the results of the audits and implementation of the recommendations; ● interviewing the internal audit Manager annually in the presence of the Statutory Auditors but without the presence of Management. ● reviewing the audit universe and risk map;

Management Audit (Financial Department) Management Audit is provided by the Finance Department and presently has six members. The main responsibilities of Management Audit are the following: ● to audit the revenue from licenses, maintenance, services and the cloud prior to each monthly closing, in addition to the costs for all offices within the Axway scope; ● to produce a Group consolidated monthly report with analysis of the results from the internal management system and audit consistency with the monthly forecasts; ● to complete the office reviews: reviews of the distribution entities and cost centers; ● to control the application of rules and procedures linked to the production of accounting and financial information; ● to assist the operational managers and train those working with the management systems. Process, Risk & Security (Finance Department) The Process, Risk and Security (PRS) quality assurance unit of the Financial Department comprises eight people and is independent from the management of operating activities. In this regard, it offers external quality assurance for projects with a view to safeguarding production and ensuring compliance with client commitments, internal procedures and regulatory requirements, as well as the effectiveness of the quality assurance system. It continuously assesses the effectiveness of quality management, based on operational performance, client satisfaction and alignment with strategic goals. Projects are reviewed on a regular basis, at key phases in their life cycle. These reviews provide an external perspective on the status and organization of business transactions. Plans for changes in the Quality Assurance System are regularly undertaken based on observations made during these controls. The PRS is also responsible for managing the Quality Assurance System, ensures the formalization, development and application of the Information Security Management System (ISMS) in conjunction with all the operational and functional departments concerned. Lastly, it manages our Quality certifications and responds to audit requests submitted by our customers. Legal Department The Legal Department (eight people) ensures that the Company complies with applicable laws and regulations in the countries where the Company operates. It plays a key role in the management of the Company’s various contractual commitments. The procedures provide for the consultation of the Legal Department prior to the signing of contracts with third parties where said contracts lay down terms and conditions that differ from the standard terms and conditions in force at the Axway Group.

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AXWAY - 2017 REGISTRATION DOCUMENT