Performance of the Board in 2012
In 2012, the Board of Directors held 4 ordinary meetings, which occurred in Limassol, Cyprus. During the course of 2012 the Board of Directors continued working on the development of the Company’s
Throughout the year the Board of Directors closely monitored the ongoing improvement of the Company’s internal control and risk management systems.
At its meetings the Board of Directors reviewed these and other issues connected with the activities of the Company within its remit, including approval of corporate reports, a long-term incentive program for senior management and a bonus scheme for the CEO.
Committees of the Board of Directors
The Company has established two committees: the Audit Committee and the Remuneration Committee. A brief description of these Committees’ main activities during 2012 is below.
Audit Committee
General Overview
The Audit Committee comprises three directors, two of whom are independent, and expects to meet three to four times each year. Currently the Audit Committee is chaired by Philippe Delpal and the other members are Gary S. Yamamoto and Vladimir V. Lukyanenko.
The Audit Committee is responsible for considering, amongst other matters: (i) the integrity of the Group’s financial statements, including its annual and interim financial statements; (ii) the effectiveness of the Group’s internal control and risk management systems; (iii) auditors’ reports; and (iv) the terms of appointment and remuneration of the auditor.
The Audit Committee supervises and monitors, and advises the Board of Directors on, risk management and control systems and the implementation of codes of conduct. The Audit Committee also supervises the submission by the Group of financial information and a number of other audit-related issues in addition to assessing generally the efficiency of work of the Chairman of the Board of Directors.
Performance in 2012
In 2012 the Audit Committee held three meetings. The main issues the Audit Committee oversaw in 2012 were the preliminary review of IFRS financial statements, internal control and risk-management, including the insider policy implementation and audit plan.
The Audit Committee supervised the internal and external audit procedures and annual tax strategy implementation within the course of the year. The Audit Committee adopted relevant decisions and recommendations to the Board of Directors with regards to internal control efficiency.
Remuneration Committee
General Overview
The Remuneration Committee comprises four directors and expects to meet at least once each year. Currently the Remuneration Committee is chaired by Gary S. Yamamoto, an independent director; the other members are Vladimir V. Lukyanenko, Yury N. Skrynnik and German Tsoy. The Remuneration Committee is responsible for determining and reviewing, amongst other matters, the Group’s remuneration policies. The remuneration of independent directors is a matter for the Chairman of the Board of Directors and the executive directors. No director or manager may be involved in any decisions as to his/her own remuneration.
Performance in 2012
In 2012 the Remuneration Committee held two meetings. The main matters reviewed by the Remuneration Committee were the long-term motivation plan for key managers of the Company, the remuneration package for the Company’s CEO and implementation of the KPI policy.
The Remuneration Committee assessed best international practices in order to adopt relevant decisions and make its recommendations to the Board of Directors with regards to the Company’s
External Audit of Financial Statements
Every year HMS Group elects an external auditor who is responsible for the auditing and inspection of the consolidated financial statements of the Company in compliance with IFRS and who prepares reviews of the consolidated interim condensed financial information of the Company in accordance with IFRS requirements. The external auditor of the Company is selected from the “top four” auditing companies after a thorough review of their proposals. Following the review of the auditors’ proposals, the Audit Committee gives its recommendations to the Board of Directors regarding the candidacy of the auditor and the amount of the auditor’s compensation, and advises the Board of Directors on other terms and conditions of the contract with the auditor. In 2012, based on the recommendation of the Audit Committee, the Board of Directors selected PricewaterhouseCoopers Limited to conduct the audit of the financial statements of the Company for the year 2012.
Directors Compensation
The compensation of Directors consists of annual remuneration paid to independent directors for their services in full positions. The total compensation of the independent directors, which is reflected as short-term employee benefits in the consolidated statement comprehensive of income in the Company’s financial statements, was Euro 195 000 for the year ended December 31, 2012.