SANDVIK FINANCIAL REPORTING POLICIES AND PROCEDURES (FRP) USER GUIDE

Hello and welcome to FRP – Sandvik Financial Reporting Policies and Procedures

• This user guide is primarily written for new employees within Finance, but may be of interest also to more experienced staff since it contains some information on search functionality and the disposition of FRP

• Please submit feedback on this guide to Monica Källstrand at Group Reporting and Consolidation

October 2016

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CONTENT

• Introduction

• FRP in relation to other policies

• Where to find FRP

• FRP chapter outline

• Tips and tricks

• Updates and communication of changes

• How to submit feedback and questions

INTRODUCTION

Purpose

• to provide updated and effective instructions for Sandvik entities in their accounting and reporting, based on accounting standards according to IFRS, the Sandvik adoption of those standards and the financial reporting requirements

Content

• contains definitions, principles and procedures necessary for Group financial planning and control, and Group reporting

Scope

• emphasis is on reporting and the definitions necessary for this and the instructions are mainly oriented to Group specific definitions, conditions and procedures. FRP is not intended as a general hand book in accounting

SANDVIK FINANCIAL REPORTING POLICIES AND PROCEDURES WILL HEREAFTER BE REFERRED TO AS ”FRP”

FRP IN RELATION TO OTHER POLICIES

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SEE ALSO CHAPTER 2.2.01 IN FRP

Local

statutory

rules

IFRS

FRP shall be applied in Group reporting

irrespective of whether local statutory rules

mandate a different accounting treatment in a

specific area. FRP requires a reconciliation of

Group reporting to local statutory reporting.

Sandvik is required to present its consolidated

financial statements in accordance with IFRS,

and FRP regulates how this is to be adhered

to.

EXTERNAL RULES INTERNAL GUIDELINES

BA

guide-

lines

Each BA may have additional guidelines in

order to provide more detailed instructions or

clarify BA specific circumstances. However,

FRP prevails, should conflicting information

occur.

User

manuals

FRP does not contain hands-on instructions

on how to example log into BPC or how to

access data submission forms. This can be

found on the Intranet under: Finance/Financial

Control/Financial Process and Systems

Development/BPC/E-Learnings.

FRP ON THE SANDVIK INTRANET

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FRP CAN BE FOUND UNDER SUPPORT/SERVICES, FINANCE, REPORTING

FRP CHAPTER OUTLINE

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FRP CONTENT OVERVIEW

Sandvik Financial Reporting Policies and Procedures consist of 7 main parts which cover the following areas:

Part 0: Updates - one chapter per year that describes the major changes made in each chapter.

Part 1: Introduction - general overview, how to best use it and governance.

Part 2: Accounting principles and Sandvik definitions – core content on accounting theory and practice

(compared with Part 3 which describes how to report).

Part 3: Sandvik Group reporting - detailed instructions and input schedules for the Group reporting, including

annual specifications and supplements.

Part 4: Business Area reporting - the five business areas specific reporting.

Part 5: Investment Procedures- description of the investment procedures, investment definitions and application process.

Part 6: Group Business Control Toolbox - frameworks and templates for reports and common analysis within

Business Control and ERM areas, primarily on Business Area and Group Levels. This Part is owned by Group Business Control.

Part 7: The Global Finance Process chapters are designed to support the mission of Group Finance Shared Services (GFSS).

TIPS AND TRICKS – SEARCH FUNCTIONALITIES

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2. A list with chapters

containing the

search word will

be displayed

1. Type your search

word and press

”Search”

3. Click on the chapter

you believe is most

relevant for your

query

4. Press F3 and a

search field will

appear

5. Type your search

word and press

Enter

6. Your search word

will be highlighted

in the chapter

TIPS AND TRICKS – LINKS

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Many chapters

include links to other

relevant chapters

Press the link and you

will be directed to the top

of the other chapter

Some large chapters

include links within

the chapters

UPDATES AND COMMUNICATION OF CHANGES

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In Part 0 Updates, you

find the current updates

made in chronological

order.

Only major changes are

logged. For example

clarifications and adding

of examples are not

logged in 0 Updates.

PART 0 UPDATES, LOG OF CHANGES

UPDATES AND COMMUNICATION OF CHANGES

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PROCESS FOR ANNUAL REVIEW

All chapters are reviewed annually by each respective policy owner. The revision is initiated by the

publisher

The owners perform the revision. The result can be a change or no change of the reviewed policy.

The approver receives the result of the review. A quality assurance process is initiated. Information about

approved policy is sent to the publisher.

The publisher attaches a new revision date to the policy and informs the persons responsible for

reporting in all Group companies (via Part 0 Updates).

FEEDBACK AND QUESTIONS

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Contact the document issuer if

you have detailed questions

within a specific chapter

For more general feedback,

please contact the FRP

Administrator or Group Financial

Control

FEEDBACK AND REPORTING ERRORS

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YOU CAN ALSO GIVE FEEDBACK ON A CHAPTER USING THE COMMENT FIELD

GROUP REPORTING AND CONSOLIDATION GROUP.ACCOUNTING.SUPPORT@SANDVIK.COM