NEOPOST - 2018 Registration document

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Corporate governance report

Committees

to select a consolidation frame of reference, to ensure the • appropriateness and permanence of the accounting policies used to draw up the consolidated and parent company financial statements and to ensure the appropriateness of the treatment of significant operations at Group level; to ensure with respect to the general management that all • legal and financial communications are correctly performed with respect to stock market authorities; to assess the level of satisfaction of statutory Auditors with • the quality of information received from the Company’s departments when performing their task and gather comments from management team regards the degree of sensitivity of the statutory Auditors to the Group’s business and its environment; to examine key issues of the statutory auditors' audit, any • information to its knowledge with respect to operations and transactions by the Company involving ethical problems, and with respect to transactions which, due to their nature and the person concerned, may reveal a conflict of interests; to ensure that key risks are identified, managed and • brought to its attention. To this end, it examines the internal control and risk management systems, the internal audit programme, monitors its development and the results of action plans, and draws the Board’s attention to any improvements that have been made or remain to be made; to issue an opinion on the renewal of appointment of the • statutory Auditors; to ensure the statutory Auditors' independence and • objectivity.

The Board is assisted by an audit committee, composed of three independent members, which met three times in 2018 with an attendance rate of 100%. On average, the meetings lasted for two hours. Until 24 September 2018, the audit committee comprised Éric Courteille (Chair), Catherine Pourre and William Hoover Jr. On this date Hélène Boulet-Supau was appointed as a member of the Audit Committee following Catherine Pourre’s departure. The audit committee monitors all matters relating to the drafting and audit of financial and accounting information, specifically: the process of preparing financial information, particularly • by examining the scope of the consolidated companies; the efficiency of internal control and risk management • systems, the application and implementation of corrective measures, where needed; legal checks of the annual financial statements and, where • necessary, the consolidated financial statements by the statutory auditors; the competence and independence of the external experts • used by the Group.

In this context, the tasks of the committee are:

to review the scope of consolidation and examine all draft • consolidated and corporate financial statements and related reports which will be submitted to the Board for approval;

The main topics discussed at the audit committee meetings in 2018 were:

Organization of work for the annual closing • Review of the annual financial statements • Review of the management report • Review of the statutory auditors’ tasks and fees • Review of acquisition price allocation • Review of deferred taxes • Examination of off-balance sheet commitments • Presentation of work to measure the impact on IFRS 15 (new revenue recognition standard) and on IFRS 16 • Validation of specific expenses (excluding auditing) • Review of internal audit procedures • Monitoring of the programmes carried out by internal audit • Presentation of the work on the impacts of the future application of other IFRS measures to implement the • “Sapin II” law on corruption and influence peddling

Financial position

Internal audit and risk management

The audit committee primarily interacts with general management, the finance department, the head of internal control and the Company’s statutory Auditors.

The statutory Auditors attend every audit committee meeting.

The audit committee can commission specific studies as required and may call on the services of outside experts.

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REGISTRATION DOCUMENT 2018 / NEOPOST