OPERATING RISKS AND RISK MANAGEMENT
Risk management is part of Finavia’s internal control system.
The Board of Directors has approved the Group’s risk management
policy which specifies the vision, objectives, operational principles, responsibilities and reporting of risk management.
Finavia takes business risks relating to the implementation of the strategy,
which can be managed to an acceptable level or the effects were they to
materialize are reasonable. Finavia was included until the end of 2005
in the State’s loss protection scheme in which the state is responsible
for losses exceeding the own risk of the company concerned. Finavia’s
liability for damages was limited by a Government decision (29 December
2005): to EUR 50 million in airport services and EUR 5 million per year in security inspection activities, separately
for both. The state is responsible for losses exceeding these amounts.
Starting from 2006, with the exception of statutory insurances for personnel and motor vehicles, Finavia has acquired insurance from competitive markets. Finavia’s assets and activity have been insured in accordance with an insurance policy approved by the Board of Directors.
Finavia aims to further develop risk management as part of management. Safety functions and security functions play a significant role in Finavia’s risk management. The Board of Directors appointed an audit committee from among its midst to assist in managing the monitoring task that is the duty of the Board. Th e audit committee prepares, guides and assesses issues relating to risk management, internal monitoring systems, financial reporting organizations, audits and internal auditing in accordance with the rules of procedure. The audit committee met fourtimes during the year.
The internal auditing unit assists the audit committee by producing information through the auditing work on the functioning and adequacy of monitoring systems and risk management. The internal auditing unit observes in its operations the operating guidelines drawn up for it, which have been approved by the management and Board of Directors of Finavia. Th e internal auditing unit is also committed to observing international professional standards for internal auditing.
The most significant risks affecting Finavia’s finances and operations concern factors impacting on the development of international air traffic that include, for example, changes in the price of oil, possible international disturbances and the global development of the economy. There are also risk factors for the abovementioned reasons associated with the investments in the new terminal required by the strong growth in traffic to Asia, and they have been taken into consideration by phasing the additional construction and by preparing the terminal for alternative uses.
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