5.9

Internal Audit Directorate

The main objective of the Internal Audit Directorate is to make an independent and fair assessment of the reliability and effectiveness of systems, processes, operations in all Company’s units and branches, as well as in its subsidiaries, and to improve thereof.

The Internal Audit Directorate (hereinafter also referred to as IAD) was arranged subject to the Organizational Structure of the Executive Office of OGK-2, approved by the decision of the Board of Directors in 2012.

The Internal Audit Directorate is functionally subordinate to the Board of Directors, and administratively – to the Chief Executive Officer. The number of the members of the Internal Audit Directorate as for December 31, 2020 is 4 people.

The Internal Audit Directorate performs the following basic functions:

• conducting internal audit and other inspections aimed at improving the internal control system efficiency;
• generalizing and analyzing the facts of violations of the Company’s financial and economic operations to develop measures to eliminate the consequences and prevent such violations;
• assessing the effectiveness of the internal control, risk management system and corporate governance, and developing recommendations to improve the efficiency thereof;
• analyzing the results of the Company’s third-party audits and overseeing the preparation and implementation of actions schedules to eliminate violations revealed during inspections;
• monitoring the implementation of action schedules to eliminate violations and breaches revealed by the IAD during inspections;
• participating in dedicated (internal) investigations into any facts of abuse (fraud), damage to the Company and its subsidiaries, and inappropriate, inefficient use of resources;
• other functions necessary for the fulfilment of the tasks assigned to the Company’s IAD.