Strategic projects (beyond the thresholds defined in the Commitments policy) are reviewed by the Group Executive Committee Commitments Committee (CECEG).
Strategic disposal projects are examined separately and supervised by the Disposals Committee (part of the CECEG) to preserve confidentiality and responsiveness.
The EDF group has organised its financial risk management around the following functions:
The Financing, Treasury and Financial Risk Management policy requires the Group entities to continuously and systematically identify financial risks (particularly those pertaining to liquidity, interest rates, foreign exchange and counterparty). The Group Risk Department exercises second level control of these risks via:
The policy on the constitution, management and control of the financial risks involving EDF’s Dedicated Assets applies to the portfolio of Dedicated Assets managed by the Finance Department. The Group Risk Department prepares an annual risk mandate and specific work management frameworks which define the principles for managing risks and the risk limits that are acceptable for this portfolio.
The accounting standards used by the EDF group (the scope of the Group’s consolidated financial statements is set out in the appendix to the consolidated financial statements for the year ended 31 December 2022; see section 6 “Financial statements”) comply with the international standards published by the International Accounting Standards Board (“IASB”) approved by the European Union and applicable as at 31 December 2020. These international standards include the IAS (International Accounting Standards), IFRS (International Financial Reporting Standards) and the SIC and IFRIC interpretations. The accounting rules and methods are specified in the Group’s accounting principles manual and summarised in the notes to the consolidated financial statements for the year ended 31 December 2022.
The principles applicable to the preparation and reporting to the Group’s Finance Department are defined in the Accounting and Financial Reporting policy. The specific internal control provisions are described in the Group guideline entitled “Internal Accounting and Financial Control”, and the control objectives to be implemented in the entities are specified and updated each year in the Group’s Internal Control Guide. The Financial Management Directors of the Departments of the Business Lines and Subsidiaries sit on the Management Committee of the entities to which they belong. With the exception of the operators of regulated infrastructure, they are appointed and assessed jointly by operational management and the management of the Finance function. A network of correspondents from the Operational Departments and subsidiaries facilitates dissemination of the guidelines and harmonised implementation throughout the various Group entities.
Each operational and functional Director of EDF makes a commitment each year with regard to the quality of the Accounting and Financial Internal Control system, the improvement goals for the coming period and the truthfulness and exhaustiveness of the accounting information for which they are responsible by drafting a commitment letter sent to the Group Accounting and Tax Director. In return, each Director receives from the Group’s Accounting and Tax Director a letter assessing the accounting and tax quality based on the various elements of the assessment (results of internal controls, indicators of the accounting quality dashboard, letter certifying the compliance of the CSP2C accounts, specific actions) to highlight the progress made and determine the improvements to be made or continued. An indicator reference framework is used within EDF. It measures areas of conformity of the accounting information for each process. As regards subsidiaries, each entity is responsible for implementing the Group’s Internal Accounting and Financial Control guideline.
The consolidated financial statements are prepared by the Consolidation Department of the Consolidation Accounting Division based on data entered locally by each entity (parent-company and subsidiary entities) in accordance with Group standards and closing instructions, following a single chart of accounts. The scope of consolidation is closed after identifying all companies of significance that are controlled, jointly-controlled or under significant influence. The non-significant nature of entities in which EDF holds an interest and which may fall within the consolidation scope is examined regularly and submitted annually for assessment by the Statutory Auditors.
