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Lesson 27 S.P.A.: CONTROLS IN THE TRADITIONAL SYSTEM, The functions
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The functions
- observance of the of the law and the statute;
- compliance with the principles of correct administration
- administrators advisors (in some cases)
- adequacy of the organizational, administrative and accounting structure adopted by the shareholder and on its concrete functioning (Article 2403, paragraph 1).
Exceptions
limited liability companies
- not qualified as public interest entities or intermediate entities
- not controlled, parent or jointly controlled by them
the statute may provide
- board of statutory auditors also carry out the statutory audit
- the company is not required to prepare financial statements
In social companies in the form of s.p.a.
accounting control cannot be assigned to the board of statutory auditors: when two of the limits indicated in art. 2435-bis, paragraph 1, are exceeded for two consecutive financial years
Extensions of duties
In the s.p.a. open
further manifestation of the duty to supervise the observance of the rules on transactions with related parties (art. 2391-bis, paragraph 3)
In the companies with listed shares the internal audit must supervise:
- adequacy of the instructions given to the controlled companies
- methods of concrete implementation of the corporate governance rules
Supervision of compliance (Article 2377, paragraph 2)
Composition and appointment
- Composition: 3 or 5 + 2 reserve
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limits accumulation of duties
- the civil does not provide any limit
but the statute can
companies with listed shares
Consob establishes limits on the accumulation of administration and control
appointment of statutory auditors
- is up to the shareholder meeting
- must be registered by the administrators
- remain in office for three years
Duties and powers
- 1) the statutory auditors must attend the shareholders' meetings as well as the meetings of the board of directors and the executive committee (articles 2405, paragraph 1,
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- 2) the board of statutory auditors may ask the directors for information (art. 2403-bis, paragraph 2)
- 3) The board may exchange information with the corresponding bodies of the subsidiary companies regarding the administration and control systems and the general performance of the corporate activity.
- 4) At any time, the statutory auditors can proceed, even individually, to inspections and controls (art. 2403-bis, paragraph 1
- 5) The board of statutory auditors may, after notifying the chairman of the board of directors, call the meeting if in the execution of its mandate it sees reprehensible facts of significant gravity and there is an urgent need to take action (Article 2406, paragraph 2)
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The durability of the office
The term of office is 3 financial years, expiring on the date of the Shareholders' Meeting called to approve the financial statements for the third financial year.
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