• CLEAN AND ENVIRONMENTALLY FRIENDLY Natural gas is the cleanest and most environmentally friendly of all fossil fuels...Read more

  • WELL DRILLING PADThe size of a typical drilling pad is about 1 hectare. To compare, the floorage of an average shopping centre is 4.5 hectares... Read more

  • SECURING OF WELL DRILLING PADA drilling pad as well as the adjacent pool are reinforced and tightened with concrete slabs. Protective foil is additionally laid where necessary.

  • WORK NOISEWell drilling does not produce onerous noise. The intensity of sounds generated in connection with drilling work is lower than that generated by street traffic.Read more

  • SAFETY OF FRACTURING PROCESSIn Poland, exploration wells in shale rock are drilled to depths of over 2.5 km.Read more

  • COMPOSITION OF FRACTURING FLUIDFracturing fluid is 95% water. Read more

  • NO MAJOR LANDSCAPE INTERFERENCEIf gas production is launched, the land surrounding the isolated, secured zone, is subject to a reclamation treatment. Read more

Statement of Compliance with Corporate Governance Rules at Polskie Górnictwo Naftowe i Gazownictwo S.A. – Contents

3. Basic features of internal control and risk management systems used by the Issuer in the process of preparation of financial statements and consolidated financial statements


The Issuer complies with the Procedure for Tax and Accounting Risk Management at PGNiG S.A. introduced on December 28th 2010 under the decision of the President of the PGNiG Management Board. The procedure governs, among other things, the following areas:

  1. Division of responsibilities related to accounting, financial reporting and tax settlement at the Company;
  2. Tax reporting, which also covers the review of source data and preparation of CIT, VAT and excise duty returns;
  3. Change management and resolution of doubts in the area of accounting and application of tax law;
  4. Duties related to distribution and description of accounting documents and supervision thereof;
  5. Financial reporting ;
  6. Accounting, financial reporting and tax settlement audits.

In the area of financial reporting, the scope of duties related to preparation of the Company’s financial statements and relevant supervisory tasks were defined. Individual stages of financial statements preparation were also described.

Under the Procedure for Tax and Accounting Risk Management at PGNiG S.A., the Company also developed and introduced the standards of internal accounting and tax audits.

Further, like most other energy and upstream sector companies, the Issuer manages specific individual risks (industry-specific risks). In its operations, the Issuer uses a dedicated system for managing overall financial safety comprising liquidity, exchange rate risk, and budget drafting and control.

The financial reporting process has not yet been subject to a separate audit, however it is reviewed on an on-going basis in accordance with the Procedure for Tax and Accounting Risk Management at PGNiG S.A. and in connection with such processes as review of accounting records related to certain processes or one-off events, for their reliability and completeness, or checking of distribution of accounting documents for correctness. Findings of and assessments formulated during operating audits related to a relevant area of accounting justify a conclusion that so far no need has been identified to develop a dedicated mechanism to be used exclusively for reviewing the preperation process for financial statements. In particular, there are no grounds to believe that the absence of such a mechanism poses any threat to the Issuer’s business. There are also no reasons to believe that this situation is likely to change materially in the near future.

Factors mitigating the risks related to financial reporting include primarily constant upgrading of particular modules of the Integrated Management System and improvement of practical skills of the employees who operate the system.

Analyses of the risks related to financial reporting and accounting, conducted by the Issuer between 2006 and 2011, showed that overall these risks were evaluated as being of moderate importance for the Issuer’s operations and that the Issuer’s exposure to these risks was low (the actual result of the analyses was: average to low).

Elements of the risk management system used by the Issuer which are relevant for the process of preparation of financial statements include in particular:

  1. The PGNiG Group’s Accounting Policy, adopted by virtue of Resolution of the Management Board of May 17th 2007, as amended, the purpose of which is to ensure compliance of the Issuer’s accountancy and financial statements with the relevant regulations, in particular with regard to the overriding principles and the quality features of financial statements, correctness of event valuation and categorisation, and safety mechanisms for databases;
  2. Instructions, procedures and controls of the Integrated Management System ensuring data consistency and integrity, including hardware checks, operating checks and authority checks;
  3. Internal controls implemented at the Accounting Department, including separation of duties, sign-off by line manager, review of received data for accuracy, independent checks, etc.;
  4. Multi-stage process of approval of the financial statements, in which the Supervisory Board is also involved; and
  5. Independent review of financial statements for reliability and accuracy by an independent external auditor..

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