Auditing

The assessments carried out by the auditing firm appointed by the Authority on the regulatory accounting documentation are stated in the Tender for the selection of the Auditor, issued by AGCom with Decision 747/09/CONS in December 2009; in short, they include the following:

• analysis of the results of auditing of Telecom Italia S.p.A. financial statements by collecting and discussing with management of this Audit all the data, information, descriptions of procedures and any documentation useful for the purposes of the appointment
• assessment of the correctness and congruity with statutory accounts of the results of Regulatory Accounting
• assessment of the coherence of the nature of the costs assigned to the so-called primary costs with respect to their subdivision in depreciation & amortization, personnel and external costs
• tracing of the data used for purposes of preparing Regulatory Accounting
• assessment of the coherence of accounting and statistical data shown in Regulatory Accounting with accounting and statistical operating  data as well as other reference sources
• assessment if necessary, of the coherence of the data used in Regulatory Accounting and the corresponding data found in operating systems
• analysis of the criteria for attribution of costs and of the capital employed
• detailed assessment of the costs by network elements, routing factors and volumes underlying each service
• assessment of internal transfer charge on the basis of criteria set forth in regulations in force and the relative volumes
• assessment of unit costs underlying the economic conditions of each service included in the reference offers of Telecom Italia and indication of any difference between prices and unit costs for each service
• assessment of the correct calculation of current costs on the basis of the criteria set forth in Decision n. 399/02/CONS and the regulations in force and those applied in national and international practice
• recommendations and observations on the main critical points emerging in the auditing.

The Auditor used a multinational audit team consisting of professionals with various qualifications and expertise and with previous experience in the specific areas of Regulatory Accounting and Current Cost Accounting. The team worked up to May 2011 with the support of the specialised staff of the Public and Regulatory Affairs Department, and the cooperation of all the other company departments that are proprietors of the data used in the regulatory documentation, in order to verify correctness and compliance with the regulations in force.

The checking undertaken by the Auditor is characterised by a particular breadth and depth. They not only checked the methods used, but also trace and verified the processing of data in the Accounting Separation regulatory system. Activities also regarded the assessment of input data (revenues, costs, capital employed, commercial and plant amounts) and the relative systems fed by this data.

Auditing concluded with a judgement of compliance by the Auditor, confirming yet again the solidity of the Regulatory Accounting process, the system and the methods used.