IBERSOL Annual Report and Consolidated Accounts 2017

ANNUAL REPORT 2017 55. Main elements of the internal control systems and risk management implemented by the company regarding the financial disclosure process The Company does not have any internal audit services reporting directly to the Statutory Audit Committee (given the Latin model adopted), the necessary compliance services being overseen by the individual departments of the company. Organizationally and functionally, the various Directions of the Group are directly responsible for compliance services to the Board of Directors and to the Supervisory Audit Committee and the persons responsible are duly identified in the Company’s organization chart, it is necessary to reaffirm that they perform in interaction with both the supervisory board and the non-executive director of the company, reporting functio- nally to the same director, regardless of the hierarchical relationship that these departments maintain with the executive management of the company. Within the scope of audit services, the external auditor meets with the different departments of the Group, at least twice a year to analyze and review the internal control system, submitting a report to the Statutory Audit Committee for subsequent discussion with the Board of Directors, namely with the non-executive director. Regarding the risk in the process of financial information disclosure, only a restricted number of employees is involved in the disclosure process. All those who are involved in the process of financial analysis of the Company are considered to have access to inside information and are specially informed of their obligations. The system of internal control of the accountability, preparation and disclosure of financial information rests on the following key elements: - The use of accounting principles, as set forth in the notes to the accounts, is one of the bases of the control system; - The plans, procedures and records of the Company and its subsidiaries offer a reasonable guarantee that only duly authorized transactions are recorded and that they are recorded in accordance with generally accepted accounting principles; - The financial information is analysed systematically and regularly by business unit mana- gement (supported by the Management Control Department) and by the heads of the profit centres, ensuring continuous monitoring and the necessary budgetary control; - A timetable is previously established for the preparation and review of information, the work is divided up among the various areas involved and all the documents are reviewed 171