Auditors and independent real estate appraisers
1. Duration of the mandate and term of office of the lead auditor
1.1 Date of assumption of the existing mandate
Ernst & Young AG (EY), Zurich, has audited the Züblin Group and Züblin Immobilien Holding AG since 1998. The auditors are elected annually by the AGM.
In the financial year 2018/19, the Board of Directors and the Audit Committee reviewed the audit mandate and invited five globally represented audit firms to submit an offer. After evaluating the bids, the Board of Directors reassigned the audit mandate to EY, assessing the services and costs involved.
1.2 Date on which the lead auditor responsible for the existing auditing mandate took up office
Christian Krämer has been the lead auditor since the financial year 2014/15. His maximum term of office shall be seven years. The rotation cycle complies with the legal regulations.
2. Audit fees
The fees paid to EY in financial year 2018/19 were CHF 62'000.
3. Additional fees
In financial year 2018/19 EY provided additional services in the amount of CHF 8'000.
4. Informational instruments pertaining to the external audit
The Board of Directors performs its monitoring and control function with respect to the external auditors through the Audit Committee, which meets at least twice a year.
The Audit Committee (AC) maintains direct contact with the auditors and exchanges information with them on all matters within the ambit of the AC. The AC is also responsible for monitoring the performance of the external auditors and reviews their independence on an ongoing basis. In addition, the AC monitors whether, and how, Executive Management implements measures that have been adopted on the basis of findings by the external auditors. The AC can also task the statutory auditors with additional audit duties, particularly with regard to specified key risks.
The external auditors notify the AuC of their findings with regard to the annual reports in the form of a management presentation and a respective report. The audit results are examined and discussed in detail with the external auditors. These results form the basis for improvements to internal procedures and auditing processes.
The AC reports to the Board of Directors on the discussions that the Committee has held with the external auditors and informs it of the most important findings and action taken.
During financial year 2018/19, representatives of the external auditors participated in the AC meeting at its invitation. This meeting was held together with the Executive Management. There were no indications that the independence of the external auditors is in any way compromised.
5. Independent real estate appraisers
The open market value of each property in the Züblin portfolio is calculated by external, independent specialists on 30 September (semi-annual report) and 31 March (annual report). This procedure complies with the regulations laid down in IAS 40 (Investment Property) and IFRS 13, which are applied by the Züblin Group. Since October 2014 JLL appraises the entire portfolio. JLL valued all of the properties as at 31 March 2019 and the results of these valuations were used in the financial statements. JLL uses the discounted cash flow method for its property valuations. In this method the current market value of each property is determined by calculating or estimating its future revenues and expenses and discounting these over the forecast horizon. In financial year 2018/19 the fees for the real estate appraisers amounted to CHF 32'000. In addition, CHF 5'000 were spent on further consulting services.
