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Risks and control Internal control

conflicts of interest policy, „ economic sanctions and embargos policy, „ sales agents policy, „ policy on membership of professional associations, „

frequent dissemination of messages from Saint-Gobain’s „ Chairman and Chief Executive Officer and General managers of the Group’s Sectors and Activities, a network of compliance and embargo officers in each „ of the Saint-Gobain General Delegations.

Organization of internal control 2.5

in preparing and processing financial and accounting information for shareholders

Compagnie de Saint-Gobain 2.5.1 (parent company) financial statements The Accounting Department is responsible for producing financial information for shareholders, partners and other third parties in accordance with French legal requirements. This information is prepared in accordance with current and generally accepted accounting standards and principles, including the going concern principle, the principles of consistent application of accounting policies, alignment of the opening balance sheet with the prior-period closing balance sheet, recognition of expenses in the same period as the revenue to which they relate, segregation of accounting periods, and substance over form. Accounting organization 2.5.2 The accounting organization is based on the rules, methods and procedures set out in the Group’s doctrine memos. It enables the monthly reconciliation and substantiation of the accounts and the true and fair view of the events which are represented. The organization also has an advisory role and works upstream to anticipate the accounting impacts of events and the regulatory changes that are likely to have a material impact on the Company’s financial statements. The chart of accounts is aligned with the Company’s needs in terms of classification of transactions, and complies with the materiality principle. It is linked to the Group’s Financial Information system. Internal control 2.5.3 Internal control is based on periodic assessments of the process for preparing accounting and financial information. In addition to controlling compliance with payment authorization procedures and the double signature rule for secure payment means, the Accounting Department contributes to internal control by acting as guarantor in respect of responsibilities defined by general management and formalized through a cost accounting system organized by cost center. Specifically, cost center managers receive monthly schedules listing the expenses incurred under their

signature, allowing them to check these expenses and also to compare actual and year-to-date expenses with the initial budget. A summary of these cost accounting reports is sent to the Finance Department and the Group’s general management at the end of each month. Measures are implemented to strengthen the arrangements for managing accounting risks and contributing to the reliability of the financial statements. For this purpose, since 2016, Group units have been subject to a Balance Sheet Review procedure under the direction of the Group Financial Control Department, with the aim of increasing the level of accounting control by the Finance Department of each entity. Group consolidated financial 2.5.4 statements The consolidated financial statements are prepared by the Group Consolidation and Reporting Department. This department is also responsible for updating consolidation procedures, training, and integrating the subsidiaries into the consolidation process, processing information, and utilizing, maintaining and developing consolidation systems and the Financial Information System for the Group and all the Sectors. Group standards 2.5.5 The Consolidation Department is responsible for providing information and periodic training to subsidiaries in conjunction with the Sectors and General Delegations, using the consolidation manual, a number of data input manuals, an intranet site and an online training application in French and English. New consolidation instructions are issued for each monthly closing, describing the changes compared with the previous period-end and enhancements to reporting systems, standards and procedures, in collaboration with the Group’s Doctrine Department. Each year, the Consolidation Department offers training sessions.

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