GROUPAMA / 2019 Universal Registration Document

7 FINANCIAL STATEMENTS Consolidated financial statements and notes

Similar systems are in place atthe entity level. In addition, a committee for the implementation and sharing of objectives, decisions, and best practices between group entities has been set up. This ARCCOperationCommittee(Audit, Risk, and Control Operational ImplementationCommittee) is coordinated by the GroupRisk Management,Control,and ComplianceDepartment and the Group General Audit Department with the participationof the Group Legal Department. It brings together the regional mutuals, the main insurancesubsidiariesin France, and Groupama Supports& Services (G2S). 1.1 As autonomouslegal entities, the regional mutuals implementtheir own internal control measures and manage their risks in compliance with the Group’s standards. These systems are adapted to each regional mutual based on its organisation, its activities and its resources, under the authority of the Executive Management. Regarding organisation and governance, the roles and responsibilities of the administration and executive management bodies, key functions, and Operational or Support Departments involved in risk managementare specified in the risk policies. The Group Risk Management, Control, and Compliance Departmentsupports the regional mutuals in monitoringand rolling out Group standards. All of the Risk Management and Permanent Control/Compliance Managers of the regional mutuals supplement the plan and meet regularly within the framework of information exchange and best practices bodies (workgroups, theme-based workshops and training), directed by the Group Risk Management, Control, and Compliance Department; work relating to the implementation of Pillar 2 of Solvency 2 is also handledthere. The regional mutuals are reinsuredwithin the specific frameworkof an exclusive reinsurance agreement entered into between them and Groupama Assurances Mutuelles (General Reinsurance Regulations).The General ReinsuranceRegulationsof the regional mutuals are one of the primary insurancerisk control systems. The principlesand rules of reinsuranceare formalisedin the reinsurance policies of the Groupand entities. For the risks related to the distributionof banking products and life insurance, the regional mutuals apply, in coordination with the Group Risk Management, Control, and Compliance Department, the risk management procedures defined by Orange Bank and Groupama Gan Vie. Regional mutuals inter-company monitoring by the Groupama Assurances ● Mutuelles Business, Functional, or Support Departments specialising in the area in question,as indicatedabove; ongoingmonitoringby the services of the division to which they ● are attached: Group FinanceDepartmentfor financial subsidiaries, ● Group Insurance and Services Department for the Non-Life ● insurance subsidiaries, the French service subsidiaries, and Groupama Supports& Services, Groupama Gan Vie’s Executive Management for the life ● insurance subsidiary and the distribution subsidiaries Gan Patrimoine andGan Prévoyance, Groupama Assurances Mutuelles 1.2 and its subsidiaries Subsidiaryrisk is subjectto triplemonitoring:

International Subsidiaries Department for international ● subsidiaries; monitoring by each subsidiary or GIE G2S of Groupama ● AssurancesMutuellesas part of the responsibilityof its Directors and in accordancewith Group standards.Followingthe example of the regional mutuals, the Risk Management, Control and Compliance Department supports Groupama Assurances Mutuellesand its subsidiariesin monitoringand implementingthe internal control and risk management procedure. As regards Groupama Gan Vie more particularly, the Regulatory and Environment Management Committee address all of its compliance issues. All of the risk management and internal control managers of the Frenchand internationalsubsidiariessupplementthe plan and meet regularly within the framework of information exchange and best practices bodies (workgroups, theme-based workshops, and training), led by the Group Risk Management, Control, and ComplianceDepartment. The Groupama AssurancesMutuelles Board of Directors, with the assistance of the Audit and Risk Management Committee, nearly half of whose members are Independent Directors, is responsible for the validation and monitoringof the risk managementstrategy, its implementation and future directions, the validation of risk policies, the review of the consistencyof internal control work, and the monitoringof risks. Lastly, the Board of Directors, particularly through the Groupama AssurancesMutuelles Audit and Risk Management Committee, is included in the Group’s various tasks for the application of the Solvency 2 Directive, including work relating to ORSA particularly with the validation of stress scenario assumptions and the examination of the ORSA report for validation by the Board of Directors. 1.3 The Group General Audit Department conducts several types of audit, including an overall economicand financial audit of the main Group entities every three years, this being in addition to operational audits conductedwithin entities, audit assignmentson Groupama Assurances Mutuelles processes and on Group cross-functional processes, and lastly audit assignments conductedon behalf of some entitiesunder the mutualisationof the key Audit function at Groupama Assurances Mutuelles. The audit plan of the Group General Audit Department is confirmed by the Executive Management of Groupama Assurances Mutuelles and approved by the Audit and Risk Management Committee of Groupama Assurances Mutuelles and the Board of Directors of Groupama AssurancesMutuelles. Every audit assignment involves a review of the risk and internal control system for the activity or entity audited; a report is prepared on the assignment presenting the observations, conclusions and recommendations to the Groupama Assurances Mutuelles Senior Management. A regular summary is presented to the Audit and Risk Management Committee. A report on the progress of the recommendationsis communicatedon a quarterly basis to the Executive Management Committeeof GroupamaAssurancesMutuellesas well as the Audit and Risk Management Committee of Groupama Assurances Mutuelles. Group

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Universal Registration Document 2019 - GROUPAMA ASSURANCES MUTUELLES