The Board of Directors’ Audit Committee is tasked with monitoring the effectiveness of Vapo’s internal monitoring, internal auditing and the company’s risk management systems. Vapo has defined operating principles for internal monitoring and the key controls of processes. The CEO and CFO are responsible for the practical organisation of internal monitoring.
Internal monitoring applies to the entire organisation and its management. Effective internal monitoring supports the achievement of strategic objectives and improves the steering of business operations. The aim of internal monitoring is to give the Board of Directors and acting management adequate assurance of the realisation of the following objectives:
Internal monitoring forms an essential part of the Group’s operations on all levels of the organisation, and is conducted on all organisational levels and in all operations. The methods of internal monitoring include internal guidelines, reporting, various ICT systems and operational practices. These help to ensure that the management’s instructions are followed and that any risks to the achievement of the Group’s objectives are responded to in the appropriate manner. Regular monitoring activities include management audits and audits concerning the measurement of operations, the performance of measurements suitable for each sector, physical monitoring, monitoring compliance with agreed approval limits and operational principles and any deviations therefrom, a system of approvals and authorisations, as well as various assurance and integration arrangements.
Operations are managed and monitored on a monthly basis, primarily by business area and, from an operational perspective, by company. Reviewing the financial period under way and rolling monthly forecasts is an essential component of the control and monitoring process.
At Group level, the monitoring activities are managed by the Chief Financial Officer (CFO). At the level of companies, they are managed by the CEOs, and at the level of business areas by the management of the business areas. The implementation of monitoring is the responsibility of business controllers appointed for the business areas and companies in question operating under the CFO who, together with the CEOs and operational management, see to business transactions being entered in the systems in a timely manner and reported appropriately and efficiently, complying with the separately issued Group guidelines on the content of internal monitoring and reporting.