Governance

The Board of Statutory Auditors of ERG S.p.A performs, with the agreement and the assistance of the relevant corporate bodies, in particular the Manager responsible for the preparation of the company financial reports and the TAX AND ADMINISTRATION DIVISION , those activities considered necessary in order for it to formulate its own justified proposal.

Specifically, it:

- Examines the proposals submitted by External Auditors;

- Picks out those External Auditors which possess the necessary requisites (those with branches in Italy and in Genoa and with listed companies and sector companies among their clients) in order to guarantee the level of service required by the company;

- Meets representatives of the individual companies so that the proposals can be presented in more detail. During these meetings the following matters are discussed in depth:

• resources in the main branch offices, experience built up in the sector, main clients, with particular reference to listed companies;
• methodological approach to audit and technical support tools;
• qualifications of the dedicated team, composition of the audit group and time necessary to complete the audit assignment;
• issues relating to Corporate Governance and analysis of the internal control system;
• fees for the audit assignment
• analyses and takes note of the estimates prepared by the audit companies as regards the professional resources and time necessary for the audit.

These estimates are drawn up in consideration of the following factors:

a) the size, composition and risk linked to the most significant balance sheet, income statement and financial data on the financial statements of the company granting the audit assignment, as well as the risk profiles connected with the process of consolidating the data relating to the companies of the group;

b) the technical knowledge and experience required for the audit;

c) the need to assure, in addition to carrying out the physical checks, suitable supervisory and guidance activities in compliance with the principles and the criteria set out by CONSOB pursuant to article 162, section 2, letter a) of Legislative Decree 58/98.

At the end of the above-mentioned procedure, the Board of Statutory Auditors informs the Manager responsible for the preparation of the company financial reports, the Tax and Administration Division of ERG S.p.A. and the Internal Control Committee of its decision regarding which proposal it recommends should be put to the shareholders’ meeting.