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COMPETENCE PROFILE AND CONCRETE OBJECTIVES REGARDING THE COMPOSITION OF THE SUPERVISORY BOARD OF LUDWIG BECK AM RATHAUSECK – TEXTILHAUS FELDMEIER AG
LUDWIG BECK am Rathauseck – Textilhaus Feldmeier AG
Munich, March 2019
The Supervisory Board
A transparent presentation of the company and its business development enhance the international comparability and also strengthen the confidence of the shareholders and other investors. The publication of the remuneration of the management surely is part of a transparent corporate behaviour. We publish the remuneration of the members of the Executive and Supervisory Board since 1998 in our Annual Reports.
Remuneration of the Executive Board
The total remuneration of the members of the Executive Board consists of several remuneration components, i.e. a fixed remuneration, a bonus, fringe benefits and a pension promise.
More detailed information on the Remuneration Report of the Executive Board can be found in the current Annual Report of the fiscal year 2018 starting page 60.
Remuneration of the Supervisory Board
The remuneration of the Supervisory Board is determined by the Annual General Meeting and is regulated by the articles of association. The remuneration depends on the duties and responsibilities of the members of the Supervisory Board and the dividend amount distributed by LUDWIG BECK. The remuneration of the Supervisory Board consists of a fixed component and a variable component. Chairing of and membership in the committees of the Supervisory Board are remunerated separately in accordance with the German Corporate Governance Code. Members of the Supervisory Board who belong to the Supervisory Board for less than a full year are remunerated on a pro rata basis.
More detailed information on the Remuneration Report of the Supervisory Board can be found in the current Annual Report on page 61.
Opportunity and Risk Report
In the course of its business in sales markets, LUDWIG BECK AG is exposed to a wide variety of risks as are involved in any business operation. These may affect the Group’s assets, finances and earnings.
We have established modern controlling instruments in order to detect, monitor and communicate such risks. These instruments ensure that our executives receive information about the development of such risks in time to launch suitable counter-measures, with the aim of steadily and sustainably increasing the value of the business. Responsibilities are clearly defined within the organization. The tools are subject to ongoing optimization in order to sufficiently accommodate structural changes. The detailed Opportunity and Risk Report can be found in the current Annual Report for the fiscal year 2018 on page 61ff.
Description of the internal control system
LUDWIG BECK has established internal controlling instruments to secure proper accounting in compliance with legal requirements.
LUDWIG BECK’s accounting procedures are governed by standardized guidelines and rules as well as clearly defined processes. Therefore, standard account parameters and accounting entry directions for different business transactions are in place. Another control tool is the clear allocation of functions regarding various accounting processes. For the most part, accounting-related items are recorded on an automated basis, e.g. all sales at LUDWIG BECK are controlled by automated cash register systems. For Group accounting purposes all bookkeeping data of the consolidated companies may be accessed.
To monitor compliance with applicable rules, LUDWIG BECK basically relies on process integrated monitoring systems. These are divided into ongoing automated control mechanisms, such as separation of functions and restricted access to certain sets of books for unauthorized personnel, controls integrated into work processes which are secured through automated accounting entries, permanently stored codes, automated accounting entry procedures and the recording of the entire sales process (cash register systems).
LUDWIG BECK’s accounting-related risk management system is set up in a way that the risks of misrepresentation, which mainly ensue from new business processes or amendments to legal provisions, are constantly monitored. Risks are contained by transferring decisions on accounting-related data resulting from unusual business transactions to the management level. Ongoing training regarding changes to the applicable accounting provisions is provided to the management. Up-to-date training in basic principles set out in the literature is carried out by external providers. In case of doubt, external consultants are called in for the implementation and integration of these principles into existing processes.
ARTICLES OF ASSOCIATION
of Ludwig Beck am Rathauseck – Textilhaus Feldmeier AG
On May 15, 2018 the Annual General Meeting elected BTU Treuhand GmbH, Wirtschaftsprüfungsgesellschaft, Munich, to audit the financial statements for the fiscal year 2018.