Getinge 2022 Annual Report
Getinge 2022 Annual Report
Introduction
Strategy
Corporate Governance
Annual Report
Sustainability Report
Other information
Contents
Internal control over the
financial reporting
At Getinge, internal control over the financial reporting is an integral
part of the corporate governance. It comprises processes and
methods to safeguard the Group's assets and accuracy in the
financial reporting, and in this manner, is aimed to protect the
shareholders' investment in the company.
Control environment
The basis of the internal control over the financial reporting
comprises the control environment, including the organization,
decision-making channels, authorities and the responsibilities that
are documented and communicated in steering documents. The
Audit and Risk Committee's responsibilities include monitoring the
effectiveness of the company's internal control, financial reporting
and risk management. Each Business Area and the Global Sales and
Service organization are responsible for continuous transaction
management and accounting. To a certain extent, Getinge's Shared
Service Center in Krakow, Poland, conducts this management on
behalf of the Business Areas and the Global Sales and Service
organization. Each Business Area and the Global Sales and Service
organization has a financial manager, who is responsible for the
financial control and for ensuring that the financial statements are
accurate, complete and submitted in good time prior to consolidated
reporting.
Control activities
The most material risks identified relating to financial reporting are
handled by the company's control activities. For example, there are
automated controls in IT-based systems that manage authority levels
and attestation rights, as well as key control elements, such as
duality in the day-to-day accounting and closing entries. Detailed
financial analyses of results and follow-ups against plan and
forecasts supplement the operation-specific controls and provide
overall confirmation of the quality of the financial reporting. The Group
follows standardized templates and models to document controls.
Information and communication
The Group has information and communication procedures to
promote completeness and accuracy in the financial reporting.
Steering documents and work descriptions are available on the
company's internal digital platform GetNet. Information regarding
the efficiency of the internal controls in the Group is regularly
reported to the relevant financial manager for the Global Sales and
Service organization and the Business Areas, as well as to the
internal control function, the finance function, the Getinge Executive
Team and the Audit and Risk Committee.
Follow-up and monitoring
Each financial manager and the Getinge Executive Team perform
monthly analyses of the financial reporting at a detailed level. The
Audit and Risk Committee follows up the financial reporting at its
meetings and the company's auditors report on their observations
and provide recommendations. The Board receives financial reports
on a monthly basis and the company's financial position is discussed
at every Board meeting. The efficiency of the internal control activities
for the financial reporting is followed up by the internal control
function in the Group every year. This comprises an assessment of
the formulation and operative function of key control elements that
have been identified and documented. The results of the indepen-
dent evaluation of key controls in the internal assurance framework
are reported to the Audit and Risk Committee every year.
Self-assessment and validation
The Group has worked for several years with a formalized process
for the follow-up and evaluation of the documentation of key
control elements. The internal assurance framework is regularly
reviewed based on the results of, for example, self-assessments and
auditing activities. This work take the form of self-assessments and
validation of the self-assessments. The validations are performed
by each financial manager or the person delegated in the Global
Sales and Service organization or the Business Area, supported by
the central internal control function.
The purpose of self-assessment is to proactively identify any
weaknesses in the internal control environment, jointly develop
improvement measures, but also to ensure the maintenance of the
achieved good internal control environment. Another purpose is to
enhance the efficiency of the local control activities in Group
companies by identifying shared work methods and transferring
knowledge between the companies to raise the general quality of
the control environment.
In 2022, two-thirds of the active companies, jointly totaling just
over 90% of the sales in the Group, conducted a self-assessment.
In conjunction with the standard Group audit, the auditors
conducted an in-depth validation of the internal control environ-
ment. Both the self-assessment and the auditors' evaluation
encompass the following processes: corporate governance (such
as assignment of authority for financial IT systems and implemen-
tation of global policies), financial reporting, production and
inventories, tangible and intangible assets, sourcing of and
revenues from products and services, salary and remuneration
procedures and tax management. The digitalization of the
self-assessment process, which commenced in 2020, continued
and more companies have been introduced to the tool.
Outcome 2022
The follow-up of the internal control in 2022 indicated that
documentation and control activities over the financial reporting
were, in all material respects, established at the validated companies.
One of the areas with the most potential for improvement is the
analysis and definition of automated controls in the Group's
financial control system.
Follow-on work
In 2023, the internal control function will continue its work to
improve the internal control environment by further development
of the framework and work method. There will be an emphasis on
clarifying roles and responsibilities, especially in cases where
companies have outsourced portions of, or entire, processes,
whether internally or through external parties. The outcome from
the year's validation and evaluation, and from the various company
audits, will be used as a basis for the continuous improvement work
on internal control via financial reporting.
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