Group Management Report Products Safety Environment Human Resources Social Commitment Consolidated Financial Statements 73
loss or theft of business secrets. ALTANA attaches great
importance to smooth availability of IT applications and services.
To guarantee this, corresponding processes and organizational
structures have been established. Emergency plans
are in place in case of significant disruptions or losses of data.
Delivery of faulty products can cause damage to peo-
ple, property, or the environment and thus cause liability risks.
This can have significant effects on the Group’s asset sit-
uation. We minimize this risk by standardizing production
processes to a large extent and by taking comprehensive
quality-control measures. In addition, we continually conduct
analyses to assess the hazardous potential of our input ma-
terials and products, and we conclude insurances.
Changes in political and regulatory framework conditions
can lead to restrictions on trade or foreign-exchange
transactions. Due to political unrest, it can be more difficult
or even impossible to access the Group’s assets in the
country or countries in question. On account of regulatory
adjustments, it might no longer be possible to sell certain
products or ingredients, or only with strong restrictions. We
continually examine the political environment in the countries
important for us and take current tendencies into account
when evaluating business relationships. We only
make direct investments in countries in which we assume the
political environment is highly stable. We actively take part
in legislative procedures and discussions focusing on changes
in the regulatory environment. As a result, we can antic-
ipate possible new requirements early on.
Legal violations (compliance risks) can give rise to liability
risks or tarnish our reputation, which can have a signifi-
cant effect on the Group’s earnings and asset situation. We
counter these risks within the framework of our compli-
ance management system, inter alia by regularly informing
and training our employees about legal requirements.
An important basis for long-term success are competent
and committed employees. Should we no longer be able
to recruit or retain suitable specialists or managers in the
future, risks could arise for the successful implementa-
tion of our strategy (personnel risks). To counter these risks,
ALTANA offers a sophisticated work environment and an
attractive compensation system, which is supplemented by
various pension plans and wealth-creation schemes. Moreover,
we regularly offer further education and training programs
to budding junior staff members, as well as to specialized
and managerial staff.
Compliant Group Accounting
Essential accounting-related risks arise particularly when extraordinary
or non-routine issues are handled. These in-
clude the first-time consolidation of acquired companies or
parts of companies as well as the recording of the sale of
Group assets. Accounting of financial instruments is also sub-
ject to risks due to the complex evaluation structure. Risks
also arise from fraudulent acts.
At ALTANA, a separate department of the Group’s hold-
ing company coordinates and monitors Group accounting.
A core component of the control system are the guidelines,
process descriptions, and deadlines that this department
defines centrally for all companies, guaranteeing a standard-
ized procedure for preparing the financial statements. For
complex issues, the instruments needed for uniform account-
ing are retained centrally for all Group companies. For recording
extraordinary processes and complex special issues,
we regularly obtain external reports, advice, and statements.
The financial statements of the individual Group companies
are prepared decentrally by the local accounting
departments. Hence the individual companies are responsible
for preparing the financial statements, in keeping with
Group guidelines and country-specific statutory accounting
requirements.
The work steps needed to prepare the financial statements
are defined such that important process controls are