The Audit Commission is a permanently-functioning internal control mechanism at JSC FPC which implements regular inspections of the financial and economic activities of the Company, its branches, the responsibilities of its bodies of management and the structural subdivisions of management at JSC FPC to ensure conformity between the legislation of the Russian Federation, JSC FPC Charter and JSC FPC’s internal documentation.
The Audit Commission acts in the interest of the Company’s shareholders and its actions are accountable JSC FPC General Shareholders Meeting.
The Audit Commission is independent of the responsibilities of the Management of the Company and of the structural subdivisions of the Management of the Company.
In accordance with JSC FPC Charter, the
In June of 2014, the Annual General Shareholders Meeting of JSC FPC selected the following for service in the Audit Commission:
The incentive for members of the Audit Commission is defined in the Regulations on the payment of remunerations and compensations to members of JSC FPC Audit Commission and provides for payment of remunerations for participation in every inspection (audit) of the financial and economic activities of the Company as well as annual remunerations.
For participation in each audit, the member of the Audit Commission shall receive remunerations in an amount equivalent to three times the minimum wage at Joint Stock Company “Russian Railways.”
The decision as to the payment of annual remunerations to members of the Audit Commission is made by the Annual General Shareholders Meeting of JSC FPC according to a recommendation from JSC FPC Board of Directors. The size of annual remunerations paid to members of JSC FPC Audit Commission may not exceed an amount equivalent to twenty times the minimum wage at JSC RZD for each inspection made.
By decision of the Annual General Shareholders Meeting, in 2014 the members of JSC FPC Audit Commission were paid annual remunerations totalling RUB 947,700.
For the verification and confirmation of the Company’s annual financial accounts, the General Shareholders Meeting of JSC FPC approves an Auditor on a yearly basis.
In June of 2014, the Annual General Shareholders Meeting approved Ernst and Young LLC as the Auditor Company to carry out the audit of JSC FPC’s financial accounts according to Russian accounting standards and IFRS in 2014.
The Centre for Internal Inspection and Auditing was created for the purpose of improving the efficiency of the system of internal inspection and auditing in the Company, guaranteeing the Company’s bodies of management trustworthy and complete information about the Company’s activities as well as the identification and prevention of abuses of power in the Company. The Centre is functionally subordinate to the General Director of JSC FPC and accountable to the Audit Committee of JSC FPC Board of Directors.
The tasks of the Centre for Internal Inspection and Auditing include: The organisation and implementation of internal inspections and audits of the financial and economic activities of the Company, its branches and structural subdivisions; the identification of financial and economic reserves and the preparation of statements warning of financial and tax-related risks and losses; the prevention of violations and shortages in the financial and economic activities of JSC FPC and the preparation of suggestions for their elimination as well as for the establishment of procedures for holding guilty member of management accountable to the laws of the Russian Federation; exposing revenue losses from passenger and postal luggage transport and the irrational use of passenger cars and identifying citizens attempting to travel in passenger trains without travel documents; the implementation of inspections to establish the required quality of long-haul passenger train service in the subdivisions of JSC FPC.