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CORPORATE GOVERNANCE AND INTERNAL CONTROL
2.5 Internal control and risk management procedures
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Registration Document 2016 — Capgemini
internal audit system
Implementation of the risk management and
exposed is an integral part of the Group’s various decision-making
processes, whether for short-term annual plans or mid-term
The analysis of the risks to which the Group’s activities are
strategic plans.
specific risk strategy for each risk considered a priority.
up-to-date overview of its key risk exposures and has defined a
objectives, structured around four key stages - identification,
prioritization, processing and steering - the Group has an
dynamic risk management process in order to ensure the proper
conduct of business and the attainment of the various strategic
In this context, the Group has implemented a systematic and
major for the Group and the related risk management systems
implemented to mitigate such risks. The different risks are
Section 1.7, Risk factors, sets out the various risks identified as
presented by type:
risks relating to operations and the strategy;
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operational risks;
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legal risks;
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financial risks.
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departments, which are responsible for day-to-day risk
management in their specific areas.
including the Ethics, Compliance and Internal Audit Department,
the Insurance Department, the Business Units and the functional
The risk management and internal control system comes from the
interaction between the Risk Committee and other risk players,
Implementation of risk management and internal control objectives
2.5.3
for the preparation and processing of financial and accounting information
financial control and financial communications.
accounting and financial rules defined by the Group relating to
budgets and forecasts, operational reporting, consolidation,
These procedures ensure the application of and compliance with
a. Financial and accounting structure
access to common resources encompassing accounting rules
The Group’s financial functions are integrated into the operating
structure, that is, both Business Units and countries. They have
shared service centers.
and procedures, information and management systems and
reported to the parent company on a timely basis, report to the
Group Chief Financial Officer in order to safeguard the
Business Unit financial controllers, whose main responsibility is to
ensure that high-quality financial and accounting information is
independence required when preparing accounting results.
Financial control is, therefore, decentralized.
reports and accounting packages used as the basis for preparing
the Group’s consolidated financial statements. The Strategic
attests to the quality of the information contained in the financial
to the corresponding Strategic Business Unit’s financial controller)
who is responsible for ensuring that the results of its activities are
Each Business Unit has a dedicated financial controller (reporting
services are correctly billed and paid, checks profit estimates for
ongoing projects and assesses their accounting impact, and
accurately reported in the accounts in accordance with Group
accounting rules and methods. The financial controller verifies that
Financial Officer.
service centers and the Statutory Auditors, setting accounts
closing and financial reporting timetables, signing off on the
accounting policies and methods, checking compliance with local
taxation and statutory reporting requirements, liaising with shared
matters that he or she sees fit to the attention of the Chief
consolidation packages of the subsidiaries under his or her
authority, signing the representation letter and bringing any and all
an effective internal control environment, ensuring that all financial
staff in the country or region are well-versed in the Group’s
Group systems and procedures in the country, helping maintain
The countries and geographic areas have a Legal Financial
Director, whose duties and responsibilities include rolling-out
which sets out:
All financial staff are required to apply the Group’s accounting
procedures and policies contained in the TransFORM manual,
the strict rules of internal control;
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what information must be reported, when, and how often;
management rules and procedures;
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accounting policies, rules and methods;
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performance measures.
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uniformity of management systems is therefore a step closer,
strengthening the control environment.
publisher’s latest version on January 1,2015 and its roll-out in the
Group’s subsidiaries continued during 2016. The desired
In addition, the Group has a single integrated management
system (GFS). The application as a whole migrated to the
centers are consolidated within a globalized structure.
Finally, the shared service centers pool the accounting processing
resources of the Group’s subsidiaries. The main centers are
located in Cracow (Poland) and Calcutta (India). These various
b. Budgets, forecasts, reporting
and consolidation
operational and accounting information required for the general
management of the Group as follows:
Group requires Business Units to submit weekly, monthly,
quarterly, half-yearly and Annual Reports of all budget, forecast,
In order to exercise effective control over their operations, the
belong. A forecast operating income statement (for the current
month, the following six months and the full year) is prepared
managers to the attainment of the budgetary targets of their
Business Unit and the next level Business Unit to which they
monthly by each Business Unit manager. Variances from budget
the variable portion of the compensation paid to Business Unit
key moment in the relationship between the different levels of the
Group’s management and makes it possible to substantially link
Unit managers and their superiors, with each budgetary item
decided based on past performance, the Group’s chosen
and negotiated at length between the different Group Business
each geographic area, Strategic Business Unit and their
component Business Units. The budget preparation process is a
strategic priorities and available information concerning expected
market trends. Group Management sets quantified targets for
budget and forecasting process; budgets form the basic building
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blocks in the management control process. They are debated