BORUSSIA DORTMUNDGmbH & Co. Kommanditgesellschaft auf Aktien, Dortmund OPPORTUNITY AND RISK REPORT RISK MANAGEMENT Borussia Dortmund's divisions are exposed to a The currency and detail of the regular risk reports wide variety of risks that are inseparably linked to given to the governing bodies of Borussia the conduct of business. Dortmund keep them informed of the Group's current risk profile. The sections below focus on possible future developments or events which could cause Borussia This ensures that the Company's decision-makers Dortmund to perform either better than expected have adequate flexibility to be able to monitor and (opportunities) or worse than expected (risks). The manage risks. respective impact of opportunities and risks are generally presented separately and are not offset This year, the risk inventory procedure implemented against one other. Generally speaking, risks and with the objective of cataloguing and assessing all opportunities are assessed over a mid-length term risks has again proven effective as a management of two years. All risks of loss to which the Company tool. Risks are identified, discussed and reviewed is exposed (individual and cumulative risks) are in consideration of current circumstances in monitored and managed within the risk one-on-one meetings or plenary sessions in order management system. to assess the current likelihood of their occurring The consolidated group for risk management and their potential consequences. purposes is identical to the consolidated group in the consolidated financial statements. Each risk is given a qualitative rating of between 1 and 4, with 1 indicating a low level of risk and 4 A functioning control and monitoring system is indicating a very high level of risk. essential for identifying risks early and for assessing A risk impact assessment is carried out both before and counteracting them. It is the responsibility of the and after the identification and development of internal risk management system to monitor and countermeasures to reduce the risk. The risk control such potential risks. impact assessments are weighted before and after The risk management system is based on principles countermeasures based on a ratio of 1:2, with and guidelines laid out by the management. These weighting prioritising the probability and principles and guidelines are designed to facilitate the consequences of each risk after countermeasures early identification of any irregularities so that take effect. In mathematical terms, the risk impact appropriate countermeasures can be taken assessment (before countermeasures) is derived immediately. In order to ensure the highest possible by adding the probability of the risk and its level of transparency, risk management has been consequences before countermeasures, while the incorporated into the organisational structure of the assessment (after countermeasures) is derived by Group as a whole. All departments and divisions are adding the probability of the risk and its required to immediately report any Company-relevant consequences, and multiplying this figure by two. changes in the risk portfolio to the management. The risk management system is also an integral component of the overarching planning, steering and reporting process. 154