The Supervisory Board, hereinafter referred to as "Board", shall be the constant supervision body of the Company.
The mandate of the member of the Board shall expire prior to the term end in the following cases:
The Board, in performing its duties, may request from the Management Board and - by means of the Management Board - from the employees of the Company reports and explanations and may examine books and documents and examine the status of the Company's property.
The Supervisory Board shall execute its duties during meetings and by supervisory and advisory activities.
Advisory activities shall be performed by the Board members on their own, at their initiative and at the request of the Management Board of the Company.
1. The standing audit committee, hereinafter referred to as the Audit Committee, operates within the Supervisory Board.
2. The Audit Committee shall be composed of three members.
3. Members of the Audit Committee, including the Chairman of the Audit Committee, are appointed by the Supervisory Board from among the members of the Supervisory Board. Members of the Supervisory Board who are to be appointed to the Audit Committee, are proposed by the Chairman of the Supervisory Board.
4. The Supervisory Board may at any time remove any of the Audit Committee members, including Chairman.
5. The expiry of the term of a member of the Supervisory Board is tantamount to the expiry of the function of a member of the Audit Committee.
6. If the membership in the Audit Committee is reduced during its term of office below the required number of three members, the Supervisory Board shall appoint the missing members of the Committee.
7. Resolutions concerning the appointment or dismissal of members of the Audit Committee shall be taken by secret ballot.
8. The Audit Committee established for the first time during the joint term of office of the members of the Supervisory Board, shall operate until the end of this term of office of the Supervisory Board. The Supervisory Board of the new term of office, at its first meeting adopts a resolution appointing members of the Audit Committee operating within the Supervisory Board of the new term of office.
1. Members of the Audit Committee shall have the knowledge and competence relevant for the industry in which the Company operates. This condition shall be deemed to have been met if at least one member of the Audit Committee has the knowledge and competence relevant for the industry in which the Company operates or individual members of the Audit Committee have knowledge and competence in specific areas of this industry.
2. At least one member of the Audit Committee shall have knowledge and competence in the area of accounting or auditing.
1. A majority of the members of the Audit Committee, including the Chairman, shall meet the independence criteria referred to in Art. 129.3-4 of the Act of 11 May 2017 on Certified Auditors, entities authorized to audit financial statements and public supervision, hereinafter the Act on Certified Auditors.
2. Each member candidate of the Audit Committee prior to his appointment to the Audit Committee is required to submit to the Chairman of the Supervisory Board a written statement indicating that he:
a) meets the independence criteria referred to in Art. 129.3-4 of the Act on Certified Auditors,
b) has the knowledge and competence relevant for the industry in which the Company operates or has the knowledge and competence in specific areas of this industry,
c) has knowledge and competence in the area of accounting or auditing.
3. Member of the Audit Committee shall immediately inform the Chairman of the Committee and the Chairman of the Supervisory Board of the occurrence of an event that results in the fact that he no longer meets the criteria of independence referred to in Art. 129.3-4 of the Act on Certified Auditors. The Supervisory Board shall take necessary actions aimed at adjusting the composition of the Audit Committee to the requirements set forth in the Act on Certified Auditors.
1. The Audit Committee shall act on the principle of collegiality.
2. The Chairman of the Audit Committee shall direct the work of the Committee and represent the Committee.
3. The work of the Audit Committee shall be organized in such a way to ensure appropriate and timely performance by the Audit Committee of the obligations in terms of issues which in accordance with the Act on Certified Auditors, the Accounting Act of 29 September 1994 on accounting (the Accounting Act) and the provisions of the Regulation (EU) No 537/2014 of the European Parliament and of the Council of 16 April 2014 on specific requirements regarding statutory audit of public-interest entities and repealing Commission Decision 2005/909/EC (EU Regulation No 537/2014), require the action (co-operation) of the Audit Committee.
4. The meetings of the Audit Committee shall be held as often as necessary, but not less frequently than twice a year, before the publication of the semi-annual and annual reports.
5. Meetings of the Audit Committee are convened by the Chairman of the Committee, either on his own initiative or at the request of any member of the Committee, or at the request of the Supervisory Board or the Chairman of the Supervisory Board, as well as at the request of the Management Board or the President of the Management Board of the Company.
6. The agenda of the Audit Committee’s meeting is set by the Chairman of the Committee. Chairman of the Committee is obliged to include in the agenda the matters proposed by the Supervisory Board or by the Management Board of the Company.
7. The members of the Supervisory Board and the Management Board of the Company shall have the right to attend meetings of the Audit Committee. The meetings of the Audit Committee may also be attended by other persons, if they are invited by the Chairman of the Audit Committee.
8. The members of the Supervisory Board who are not members of the Audit Committee, the members of the Management Board and other persons participating in the meeting of the Audit Committee do not participate in the vote on the resolutions of the Committee.
1. The Chairman of the Committee convenes the meetings of the Audit Committee notifying all members of the Audit Committee and all other persons entitled to attend the meeting of the Committee, of the place, date and agenda of the meeting.
2. The meetings of the Audit Committee are held at the Company's registered office or at any other place designated by the person convening the meeting.
3. Technical measures and procedures related to convening, preparation and servicing the meetings of the Audit Committee are performed by the Company’s Office under the authority of the Chairman of the Audit Committee.
1. Resolutions of the Audit Committee are adopted by an absolute majority of votes in the presence of at least half of the composition of the Committee. In the event of a tied vote, the Chairman of the Audit Committee shall have the casting vote.
2. Votes at the meetings of the Audit Committee are cast in an open-ballot.
3. Members of the Audit Committee may participate in adopting the resolutions by casting their votes in writing through the agency of another member of the Committee.
4. The Audit Committee may adopt resolutions by circulation or by means of distance communication.
5. In matters related to voting in writing, adopting resolutions by the Audit Committee by circulation or by means of distance communication, the provisions of Par. 17 of the Rules of Procedure of the Supervisory Board shall apply accordingly.
1. The Audit Committee’s responsibilities include in particular:
1) monitoring of: (a) the financial reporting process, (b) the effectiveness of internal control and risk management systems and internal audit systems, including in terms of financial reporting, (c) audit performance, in particular the audit referred to in the Act on Certified Auditors,
2) reviewing and monitoring of the independence of the statutory auditor and audit firm,
3) informing the Supervisory Board of the results of the audit, referred to in the Act on Certified Auditors; explaining how the audit contributed to the reliability of financial reporting, and what was the role of the Audit Committee in the audit process,
4) assessing the independence of the certified auditor and giving consent for the provision by certified auditor of specific non-audit services referred to in the Act on Certified Auditors;
5) developing a policy for selecting an audit firm to perform the audit referred to in the Act on Certified Auditors;
6) developing a policy for the provision by the audit firm, by the entities affiliated with that audit firm and by a member of the audit firm's network, of specific non-audit services referred to in the Act on Certified Auditors;
7) developing a procedure for selecting the audit firm by the Company;
8) providing the Supervisory Board with recommendations regarding the selection of an audit firm in accordance with the requirements set forth in the Act on Certified Auditors;
9) submitting recommendations aimed at ensuring the reliability of the Company's financial reporting process;
10) performing other tasks of the Audit Committee resulting from the Act on Certified Auditors, the Accounting Act and EU Regulation No. 537/2014.
2. The Audit Committee may, without involving the Supervisory Board, request information, explanations and documents necessary for the performance of the tasks referred to above.
3. The Audit Committee shall annually submit to the Supervisory Board a written report on its activities.
In other matters not regulated in this Chapter relating to the tasks, powers and functioning of the Audit Committee, relevant provisions of the Act on Certified Auditors, the Accounting Act, EU Regulation No. 537/2014 and the Rules of Procedure of the Supervisory Board shall apply.
Appropriate provisions of the Commercial Companies Code and the Articles of Association shall apply to all matters not governed hereby.
The Rules hereof were passed by the Supervisory Board on 9 Oktober 2017.
These Rules hereof shall be valid as of its passing and shall replace the Rules of the Supervisory Board passed by the General Meeting on 24 May 2011.
The Chairman of the Supervisory Board
Bogumił Adamek
Korporacja Gospodarcza efekt S.A.
31-323 Kraków
ul. Opolska 12
tel.: +48 12 420 33 30
fax: + 48 12 420 33 44
