Board o f Direct ors The activities of the Boar d of Director s and the division of responsibilit y bet w een the Boar d and the President and CEO and Group M ana g ement are g o v erned b y formal procedures The Boar d consider s risk assessment and control fundament al to achie vin g its corpor ate objectiv es with an accept able risk rew ar d profle The Boar d pla ys an import ant role in the on g oin g process of identif yin g and e v aluatin g signifcant risks faced b y the Group and the efectiv eness of related controls The processes used b y the Boar d in or der to re view the efectiv eness of the sys tem of internal control include Discussion with Group M ana g ement re gar din g risk areas identifed b y Group M ana g ement and the per formed risk assessment procedures R e view of signifcant issues arisin g from e xternal audits and other re views in v es tigations The Boar d of Director s has es t ablished an Audit Commit tee in or der to monitor the efectiv eness of the Group s internal control sys tems and fnancial reportin g process A udit Commit t ee The Audit Commit tee re views all annual and quarterly fnancial reports before recommendin g their publication on behalf of the Boar d The Audit Commit tee in particular discusses the signifcant accountin g policies es timates and jud gments that ha v e been applied in preparin g the reports The Audit Commit tee super vises the qualit y and independence of the e xternal auditor s Management As surance The Group has a coor dinatin g and monitorin g function in relation to cert ain internal control activities at Group le v el The M ana g ement Assur ance s t af function oper ates as the Group s internal audit function and reports directly to the Senior V ice President Finance with an open line of communication to the Audit Commit tee This function prepares an annual plan for its w ork which is appro v ed b y the Audit Commit tee The results of the function s w ork which includes the e x ecution and coor dination of internal audit related activities durin g the y ear are presented at the Audit Commit tee meetin g s The M ana g e ment Assur ance Director participated in all Audit Commit tee meetin g s durin g 2012 In line with one of the Group s fundament al principles this function has continued to de v elop s tepb y s tep impro v ements of the Group s internal control throug h v arious activities throug hout the y ear includin g fnetunin g of follo w up procedures and reportin g identifcation of risks related to fnancial reportin g and e xamination of the efectiv eness of related internal controls In 2012 specifc focus la y on dia gnos tic s in new mark et countries and new businesses Sharin g kno wled g e throug h diferent activities is also a k e y part of impro vin g the control en vironment The function utiliz es a combination of internal resources and e xternal resources in the form of e xternal auditor s consult ants and e xperts dependin g on the specifc situa tion and area This enables greater fe xibilit y and responsiv eness to the risks faced b y the Group which fts Securit as business model F or more information on the current responsibilities of the M ana g ement Assur ance function refer to www securit as com mana g ement assur ance The function is subject to an annual assessment b y the Boar d to ensure that the activities undert ak en enable a w ellfunctionin g monitorin g s truc ture tog ether with the other components of the Group s internal control described within this report Stockholm M arch 15 2013 The Boar d of Director s of Securit as AB Auditor s report on the Corpor ate G o v ernance St atement T o the Annual G ener al M eetin g of the shareholder s of Securit as AB corpor ate identit y number 5563027241 It is the Boar d of Director s who is responsible for the Corpor ate G o v ernance St atement for the y ear 2012 on pa g es 3247 and that it has been prepared in accor dance with the Annual Accounts Act W e ha v e read the Corpor ate G o v ernance St atement and based on that readin g and our kno wled g e of the compan y and the Group w e belie v e that w e ha v e a sufcient basis for our opinions This means that our s t atutor y e xamination of the Corpor ate G o v ernance St atement is diferent and subs t antially less in scope than an audit conducted in accor dance with International St andar ds on Auditin g and g ener ally accepted auditin g s t andar ds in S w eden In our opinion the Corpor ate G o v ernance St atement has been prepared and its s t atutor y content is consis tent with the annual accounts and the consolidated accounts Stockholm M arch 15 2013 Pricew aterhouseCooper s AB P e t er Nyllinge A uthoriz ed Public A c c ount ant 47 Securit as Annual R eport 2012 G o v ernance and mana g ement Boar d of Director s report on corpor ate g o v ernance and internal control