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Objectives, content and basic parameters of the Report
Objectives and basic parameters of the Report
Open Joint-Stock Company Nuclear and Power Engineering has issued this Integrated Annual Report (hereinafter referred to as the Report) to disclose information regarding performance of the Engineering Division of Rosatom State Corporation (hereinafter referred to as the Division) for the period from January 1, 2013 to December 31, 2013 as well as regarding its development outlooks.
OJSC Atomenergomash traditionally follows its annual reporting cycle; the previous Report was released in 2013 and covered the results for the 2012 reporting year.
Objectives and goals of the report
Regulatory framework for Report preparation
The Report for 2013 was prepared taking into account the requirements of the following regulatory documents (current versions):
- Federal Law "On Joint Stock Companies" No.208-FZ dated 26/12/1995;
- Federal Law "On Accounting" No.402-FZ dated 06/12/2011;
- Order of the Federal Commission for Securities Market of the Russian Federation "On approval of the Regulation for disclosure of information by security issuers" No.11-46/pz-n dated October 4, 2011;
- ISO 26000:2010 Guidance on social responsibility, etc.
A comment on transition to GRI G4
The Company has approved internal documents: Standard and Regulation for the Annual Public Reporting.
A process for definition of content and preparation of the Report
The Strategic Development Department is the initiator and organizer of the Report preparation process in the Company.
The first stage is preparation of the Report Concept, including:
- analysis of stakeholder proposals and comments made during the previous reporting campaign;
- updating the methodological framework based on the applicable requirements;
- analysis of the world’s best public reporting practices.
The third stage is a survey of members of the Public Reporting Committee that includes representatives of all Departments of the Company covering respective areas of activity.
The survey results are applied to a map of significant aspects which is included in the Report Concept. A prepared draft Report Concept is presented at a meeting of the Atomenergomash Public Reporting Committee, and, after approval by the Committee, is presented to the stakeholders in a public dialogue.
As part of the dialogue, stakeholders undergo a survey. The questionnaire provides for selecting from a full list, the aspects which should be first of all shown in the Report according to the stakeholders' opinion. The survey results refine every aspect's position on the horizontal axis (influence on stakeholder assessment). This not only makes it possible to take into account but also illustrate the opinions and requirements of stakeholders.
Based on the results of the material aspects analysis performed by the Company, the information disclosure boundaries will not cover companies outside the Division.
Map of material aspects
In accordance with GRI G4, the boundaries for information disclosure were defined separately for each aspect. To this end, for some of the indicators, the scope of the key SASC was changed:
- Due to changes in the OJSC Atomenergomash management profile, OJSC DEZ was excluded from the perimeter.
- For some of the aspects, the perimeter was enlarged. For data comparability in relation to disclosure of the indicators for such aspects, data for previous years are presented in a comparable format and in the form of a SASC breakdown.
- For some aspects, the perimeter was reduced due to the companies, for which these aspects are not material and their data have little impact on the total performance figures.
The consolidated financial reporting profile is presented in Appendix 2 (aspect No.1).
In addition, the Concept represents the central topics with a focus on their characterization. In this Report, the two central topics selected based on the key events of 2013 are associated with each other:
There were no other restatements of information.
The final version of the Report is approved by the Board of Directors and the General meeting of shareholders.
Disclaimer
This Report contains a number of forward-looking statements concerning the non-financial aspects of the Company’s activities, its plans, projects and anticipated results.
The words “intend,” “endeavor,” “expect,” “evaluate,” “plan,” “consider,” “propose,” “may” and other such expressions usually indicate the forward-looking nature of a statement.
By virtue of their specific nature, forecasts involve inherent risk and uncertainty, both general and specific. A range of economic, political, social, technological and other stochastic factors may influence the Company’s activities both inside and outside of Russia.
In this regard, the Company points out that the actual results may differ essentially from those expressed, both directly and indirectly, in such forward-looking statements contained within the Report. The Company in no way claims or guarantees that the performance or any indicators or events mentioned in such forward-looking statements will be achieved and shall bear no liability for losses that may be suffered by legal entities or individuals adopting decisions based on these forward-looking statements.
Assurance of quality of the Report
Internal procedures
The Public Reporting Committee takes part in all key stages of the Report preparation acting in accordance with the Regulation on Preparing a Public Annual Report adopted at OJSC Atomenergomash. Its main responsibility is to coordinate the work on preparation of the Report as well as assessment of the materiality and completeness of the information disclosed in the Report.
Internal audit plays an important role in the preparation of the Report. Its objective is to express an opinion on the effectiveness of the system of internal controls during the compilation of public reporting to ensure compliance with the legislation and internal regulations of Rosatom State Corporation and OJSC Atomenergomash.
Primary tasks of the internal auditor:
- analysis of regulation and formalization of key processes associated with the compilation of public reporting;
- analysis of the implementation effectiveness of key control procedures which ensure credibility of public reporting;
- assessment of conformity of the public reporting compilation procedure with applicable laws and internal regulations governing the business process of public reporting compilation;
- preparing recommendations on improvements to the internal control system when preparing public reporting.
In addition, the Report includes a conclusion of the Audit Committee that conducts its activity independently of the Company's management officials and acts in the interests of shareholders.
The Audit Committee regularly monitors the financial and economic activities of the Company for compliance with the legislation, the Company Charter, regulations of Rosatom State Corporation and the internal regulations of the Company, and, at the end of the year, confirms the credibility of the financial statements included in the Report.
Independent professional assurance
To verify the credibility of accounting statements (including combined accounting statements), OJSC Atomenergomash, in accordance with the Russian legislation, has engaged LLC FBK, one of the oldest Russian audit and consulting companies currently being a leader in the market of professional audit services.
Appendix 8, Appendix 9 Аудиторские заключения
On a yearly basis, during preparation of the Report, the Company engages a professional independent auditor to conduct the Report assurance procedure. In distinction from financial audit, the non-financial auditor is not approved by the Board of Directors, but is selected during a standard services procurement procedure.
The main subject of the audit is compliance with the requirements of:
- legislation of the Russian Federation regarding the information disclosed in annual reports of joint-stock companies;
- Rosatom State Corporation and local regulations of OJSC Atomenergomash regarding public reporting compilation;
- the GRI G4 Manual (for the "core" level);
- International Integrated Reporting Framework (IIRC);
- АА1000 Accountably Principles Standard 2008 (regarding main principles).
Stakeholders Committee and public assurance of the Report
The Stakeholders Committee is a permanent body of the OJSC Atomenergomash public reporting system operating on a voluntary basis in accordance with the Terms of Reference for the OJSC Atomenergomash Stakeholders Committee. The Committee includes representatives of key stakeholders of OJSC Atomenergomash, among which are representatives of Rosatom State Corporation, nuclear industry companies, public and environmental organizations, experts, etc. The purpose of the Committee is expressing the stakeholders opinion and interests.
Primary tasks of the Committee:
- assessment of the materiality, completeness and objectivity of the information disclosed in the Report;
- preparation of recommendations to improve the quality of the Report from the stakeholders' point of view;
- Public monitoring of the public reporting processes.
During preparation of the Report for 2013, the Committee, following the tradition, worked using the format of public dialogues. Along with that, the Company continues to develop the functions of the Committee, being guided by the international experience and best practice, according to which the subject of the Committee's review is not only the Report, but the activities of the Company in the aggregate as well.
. From this point, the selection of the Report's central topics was linked with the Company's development projects being implemented, which are the Building the Sustainable Development Strategy and the Building the Corporate Risk Management System. Thus, the Committee, as part of the dialogues, has discussed not only the Report, but individual areas of the Company business as well.
Members of the Stakeholders Committee conducted public assurance of the Report as part of its preparation process.