Universal registration document and annual financial report 2019

108 2019 Universal registration document and annual financial report - BNP PARIBAS

2 CorPorate GovernanCe and internal Control

Internal control

INTERNAL CONTROL EMPLOYEES At year-end 2019, the various internal control functions were supported by the following headcount numbers (FTE = Full Time Equivalents, year-end):

2015 2016 2017 2018(1) 2019 Change

(2018/2019)

Compliance 2,715 3,387 3,770 4,186 4,378 +5%

LEGAL 1,650 1,754 1,752 1,841 1,810 -2%

Risk 2,635 5,163 5,232 5,321 5,475 +3%

Periodic control 1,104 1,236 1,296 1,394 1,446 +4%

TOTAL 8,104 11,540 12,050 12,742 13,109 +3%

(1) Internal control employees in 2018 did not include FHB (First Hawaiian Bank).

INTERNAL CONTROL PROCEDURES RELATING TO PREPARING AND PROCESSING ACCOUNTING AND FINANCIAL INFORMATION

ROLES AND RESPONSIBILITIES FOR PREPARING AND PROCESSING ACCOUNTING AND FINANCIAL INFORMATION Under the authority of the Chief Operating Officer, the Finance Function is responsible for preparing and processing accounting and financial information. It also has an independent control mission which aims to ensure control of the risk related to this information. The missions, implemented with the contribution of all those working within the function, are defined in a specific charter. These consist of:

■ defining accounting policies and standards as well as management information principles and standards;

■ preparing accounting information and ensuring their regulatory reporting;

■ producing information used in solvency and liquidity ratios, calculating the ratios themselves and preparing the regulatory reporting of them;

■ preparing management information (realised and projected in accordance with various scenarios) and providing the necessary support for economic management;

■ managing the risk associated with accounting and financial information (results, balance sheet, solvency and liquidity) by defining and implementing a permanent operational control system;

■ handling the Group s financial communication, ensuring that it is of good quality and well-perceived by the markets;

■ managing the Group s financial structure;

■ overseeing the architecture, design and deployment of the financial information systems (results, balance sheet, solvency, liquidity);

■ defining and leading the organisation of the Finance Function;

■ determining the organisation and operational processing of activities related to the Finance Function;

■ exercising a duty to alert Executive Management.

All of its missions, whether carried out directly or with other functions and the ALMT, require those involved to be fully competent in their particular areas, or, in other words, to understand and check the information they produce and to comply with the required standards and time limits. Particular attention is paid to compliance, quality and integrity of the information used and data protection. Under the authority of the Group CFO, the governance of the system as a whole relies on three basic principles: decentralising the Finance Function, separating the accounting and management information channels, and giving either operational areas (division/business line) or geographical areas (legal entities) responsibility for finance. In practice, the responsibility of the Finance Function is carried out as follows:

■ the Finance Function in each entity produces accounting and financial information and carries out the controls to ensure its reliability; the entity s Finance Department sends the information produced to the division/business line to which it is operationally attached;

■ the divisions/business lines carry out a business analysis and check the data produced by the entities and improve its quality, for instance by reconciling, at their level, the accounting and management data;

■ centrally, Finance prepares the reporting instructions distributed to all divisions/business lines and consolidated entities in order to ensure that the data is homogeneous and complies with the Group s rules. It gathers all the accounting and management information produced by the entities and approved by the divisions/business lines and assembles and consolidates these data for use by Executive Management or for communication to third parties.