The Board is responsible for internal controls. The Board may be assisted by the Managing Director and, if necessary, internal audit if a particular area requiring an audit has been identified. Since AP6 has few employees, and no separate (in-house) function for internal audit, external consultants with the right expertise are instead engaged.
Risks that have been identified, during internal audit and/or ongoing internal control activities, are managed by making changes and/or improvements to the organizational structure, decision paths, powers of authority or allocation of responsibilities.
Committees that support operations
The Investment Committee makes decisions concerning investing activities and prepares supporting documentation on investments that will be considered by the Board.
The Ethics Committee handles ethical issues that arise within the organization.
The Nomination and Remuneration Committee monitors the nomination and remuneration issues faced by investment managers at portfolio companies.
The Valuation Committee is responsible for, prior to the publication of annual and interim financial statements, establishing the valuations of unlisted holdings.
The Board’s own assessment
Under the Sixth AP Fund Act (2000:193), the Board must carry out its own annual assessment of its management of the fund assets, i.e. a performance review. This assessment must be submitted to the government in conjunction with the presentation of the annual report and the auditors’ report. It is presented in a separate report published on the AP6 website.
AP6’s auditors are appointed by the government. The auditors’ work includes examining AP6’s operating activities, administration, financial statements and annual report. Based on their audit, the auditors express an opinion on the accounting records and the administration. Their work also includes verifying that AP6 follows generally accepted accounting and valuation principles, and that the accounting records provide a true and fair view of operations. AP6’s IT environment is also audited.
At least once per year, the auditors present a report on their audit to the Board, along with issuing a written report on their audit of the administration and financial statements. In addition to this, the auditors report to the Ministry of Finance once a year.
In addition to the Board’s own assessment, the Ministry of Finance conducts an annual assessment of AP6’s operations on behalf of the government. This assessment is carried out for all AP funds with the assistance of external consultants. The assessment is presented in a written report to the Swedish Parliament which is published in conjunction with the government adopting the income statements and balance sheets of the AP funds for the financial year.