Does the Company follow the rules of corporate governance?

1. Pointing the set of corporate governance rules adapted by Inter Cars S.A.
   Inter Cars S.A. Company adapted to use the rules of corporate governance published in the document called “Code of good practice for companies listed on Warsaw Exchange"; as published on webpage www.corp-gov.pl.
    
2. Exclusions from the rules of corporate governance.
   The Board of Inter Cars S.A. declares that the Company in 2012 followed the general rules of corporate governance, excluding the following points:
   
   
   1. Point I 1) The Company should have clear and effective information policy, using traditional methods, as well as modern technology, assuring speed and security and wide access to information. The company using this methods as wide as possible should assure suitable communication with investors and analysts, transmitting General Shareholders’ Meetings, recording them and publishing them on website.
      
      EXPLANATION:
      The Company leads clear and effective information policy assuring required communication with investors and analysts by traditional methods, and that is why it gives up recording and transmitting General Shareholders’ Meetings using Internet and publishing them on the webpage.
       
   2. Point III. 6) At least two Members of Supervisory Board should fulfil independency criteria and subjects being dependent and combined with the Company. About independence of Members of Supervisory Board Appendix II of European Commission Recommendations dated 15 February 2005, about role of not executive directors or being Members of Supervisory Board of public companies and Supervisory Commission. Independently from resolutions of point b) of above mentioned Appendix, the person being employee of the company, dependent subject or associated company cannot be treated as fulfilling criteria of being independent, mentioned in this Appendix. Moreover as connection with shareholder which excludes being independent Member of Supervisory Board according to this regulation, an actual or crucial connection with a shareholder having 5% or more votes in General Shareholders’ Meeting is understood.
      
      EXPLANATION:
      In compliance with Articles of Association of the Company, the Supervisory Board shall be composed of 5 to 13 members appointed by the General Shareholders’ Meeting. Today the Board is composed of 5 members. Members of Supervisory Board are appointed by voting of all Shareholders having the right to vote and interested in the matter. Candidates for being Members of Supervisory Board, together with information about their work experience and qualifications are published beforehand and also presented to General Meeting of Shareholders. Appointing Members of Supervisory Board is a sovereign decision of Shareholders being present in the Meeting and there are no reasons to make any restrictions for appointing.
       
   3. Point III. 7) Inside the Supervisory Board there should be at least one Board of Audit. At least one member of this committee should fulfil independency criteria from the Company and subjects being dependent and combined with the Company, having financial and booking competence. In companies in which Supervisory Board consists of number of members required by the law, the tasks of committee can be carried out by the Supervisory Board.
      
      EXPLANATION:
      Currently the Supervisory Board is composed of 5 members and the Board also performs the role of the Board of Audit.
       
   4. Point III. 8) The scope and range of committees actions within the Supervisory Board should be regulated by Appendix I to European Commission Recommendations dated 15 February 2005 the role of nonexecutive directors (…).
      
      EXPLANATION:
      Because of the fact that the whole Supervisory Board is also the Board of Audit, and the Board of Managers has no influence on appointment of its Members, the Company shall not comply with guidelines stipulated in Appendix I to European Commission Recommendations.

3. The description of the main features of internal control and risk management systems used in the Company in regards to the process of preparing financial reports and consolidated financial reports.

Financial reports and interim reports of the Company are being prepared in compliance with the law in force and binding accounting policy of the Company, by CFO and are verified by the Board of Managers, which is responsible for its reliability and conformity with accounts.

Financial reports are prepared only by people with granted access to confidential information, what obliges them – from the moment of obtaining such information till it has been published in financial report – to keep the trade secret of all data being used as the basis of the reports. Financial data being the basis of financial reports and interim reports come from booking-finance system, in which all booking operations are recorded in compliance with accounting policy of the Company (accepted by the Board), based on International Booking Standards and International Financial Reporting Standards. The Company constantly monitors all the changes required and forced by law regulations and rules which apply to requirements of stock exchange reporting requirements and prepares to implement them beforehand.

Financial reports approved by the Board are later verified by an independent auditor – expert auditor, chosen by the Supervisory Board of the Company, from among renowned international auditing companies.
Financial Division, keeping constant contact with expert auditor, tries to set recommendations regarding development and improvement of internal control procedures within the Company, which were identified during audit of financial reports, in order to implement them.

Financial Division and Directors of other divisions prepare, for the use of the Board of Managers, interim reports with management information analysing key financial data and operational ratio of business segments.