Finance Competency Model 2007

Finance

Competency Framework

2Competency Framework – Finance Apr 21, 2023

Table of ContentsPAGE

• Finance Competency Framework Overview……………………………………………………………2– Competencies support the achievement of the Finance Vision………………………………………………4– Introduction to the Competency Framework……………………………………………………………………5– Competencies link to talent and career management…………………………………………………………6– Four tips to identifying which competencies to work on……………………………………………….………7– Overview of competency groupings……………………………………………………………………………..8

• Lafarge Leadership Profile Competencies…………………………………………………………...…9– Overview of each competency…………………………………………………………………………………..10– Finance examples of Leadership Profile competencies…………………………………………….………..16

• Finance Behavioral Competencies……………………………………………………………………..17– Proficiency Scale…………….…………………………………………………………………..………… ……17– List………………………………………………………………………………….………………………………18– Overview of each competency……………………………………………………………………………….....19

• Finance Technical Competencies……………………………………………………………………….25– List………………………………………………………………………………….………………………………25– Overview of each competency……………………………………………………………………………….....26


Finance Competency Framework Overview


Finance Competency Framework

Vision and

PurposeLeading People

Driving for

Results

Custom er

FocusLeading Change

Integrity and

Value

Personal

Involvem ent and Openness

Interpersonal

SkillsDecision Making Negociating

Organizational

SkillsProblem Solving

Broad

Financial

Statem ent Analysis

Capital Project

Analysis

Industry and

ProductKnow ledge

Project

Managem ent

Analytical

Modeling

Forecasting and

Planning

Risk

Assesm ent

Internal Control

Practices

Financial

Com m unication and

Managerial Reporting

Specific

Support and

Financial Processes

Transactional

Accounting andAnalysis

Acquisition and

Divestm entAnalysis

IFRS and

InternationalStatutory

Requirem ents

Accounting and

Consolidation

Credit and

Collection

Tax Analysis on

Business Decisions

Incom e Tax Law

Com pliance

Cross Border

TaxIm plications

Risk and

Insurance Managem ent

Treasury :

Cash Managem ent

Treasury :

Financing

Treasury :

Financial risk m anagem ent

System s

BEHAVIORAL COMPETENCIES

LEADERSHIP COMPETENCIES

TECHNICAL COMPETENCIES


The competency framework supports the achievement of the Finance Vision:

Finance Vision

Provides decision support and business performance management

Delivers and maintains expertise for Lafarge: (Tax, Treasury, Corporate Accounting, Internal Audit)

Drives efficiencies in record-to-report and transactional processes

(Financial Shared Services Centers)

Establish an organization which focuses on value-creation for the businessthrough efficient financial processes and more effective business support

Achieving this vision will require that we refocus finance in the following three areas:

Operations

Competency Centers

Shared Services Centers

Accounting Transactions


This competency framework guides Finance professionals in developing leadership, technical, and functional proficiency.

• A competency is a cluster of related knowledge, skills, and attributes

• Competencies:– Contribute to successful performance– Can be measured against well-accepted standards– Can be improved via learning and development

• The guide contains important information related to the competencies requiredto achieve the Finance Vision at Lafarge:– Leadership Profile Competencies – Finance-Specific Behavioral Competencies– Finance-Specific Technical Competencies

• Take some time to familiarize yourself with the content of this guide. – As you do, think about your strengths and development needs. – Use this information during performance reviews and in the creation

of your Individual Development Plan (IDP)

Introduction


Competencies link all aspects of career and talent management.

Competencies Overview


Four tips to identify what competencies to work on.

Consider the nature of your current role: individual contributor, manager, executive?

Consider the nature of your next role: individual contributor, manager, executive?

Review your strengths and developmental opportunities from your past 1-2 performance appraisals.

– What strengths do you have today which must be stronger or maintained for the future?

– What new competencies do you need to develop most urgently?– In what areas do you think you are stronger than others do?– In what areas have you not had the opportunity to develop or become skilled?

Bundle these together and choose 2-5 competencies on which to focus, based on:– How difficult will it be to develop each of these?– How much support will you have?– To what extent are your developmental needs related? Can you “kill two birds

with one stone”?

Tip 1 Tip 2 Tip 3

Tip 4

Choosing Competencies


Overview of Competency Groupings:

• Lafarge Leadership Competencies– These skills and attributes are common to all employees of Lafarge regardless of function or

business line– Examples of each of the six leadership competencies have been provided to help Finance

professionals understand how to translate these competencies to their day-to-day work

• Finance Behavioral Competencies– Behavioral competencies are those skills and attributes that help understand the manner in

which we get our work done– For example, skills such as having good interpersonal skills, making good decisions, and

possessing business acumen are essential

• Finance Technical Competencies– These are the skills that are specific to your function only– Often, doing the work requires a higher level of proficiency in a technical competency than

managing it

Finance Vision


Lafarge Leadership Profile Competencies

Lafarge Leadership Profile competencies are relevant for all employees regardless of function or line of business


Vision & Purpose

Lafarge Leadership Profile


Leading People



Driving for Results



Customer Focus



Leading Change



Integrity and Values



Finance examples of Leadership Profile competencies

Vision and Purpose Leading People Driving for Results

Continuous business process improvement to drive efficiency and effectiveness

Liaise with other Divisions, Business Units, etc. to ensure optimal business operation

Mobilize people and inspire them to achieve key finance KPIs and objectives

Develop department employees to other positions for bench strength

Communicate with candor, sharing what is known, stating what is not yet known and addressing problems, issues and challenges

Provide employee recognition through formal and informal systems

In addition to technology, consider process and organization to ensure optimum structure

Critical review of financials to validate against business performance resulting in material corrections

Actively participate in the development of strategic goals for the organization

Establish policies and procedures to control spending and safeguard financial and physical assets

Customer Focus Leading Change Integrity and Values Know and understand external

customers’ needs, opportunities and threats

Treat internal clients as business partners

Provide creative financial solutions to increase business and decrease costs

Establish and comply with Service Level Agreements (SLAs)

Support an enhanced and consistent customer experience

Review and recommend changes to governance and financial policies to ensure alignment with changes

Communicate and ensure understanding of finance strategy and KPI’s across the business

Able to influence key stakeholders to adopt new practices and approaches

Honest and direct in dealing with internal & external customers; represents Lafarge in a professional and positive manner

Demonstrate a commitment to improving and adhering to safety policies in all work environments

Finance Examples


Level A Level B Level C Level D

Basic:

Demonstrates basic knowledge and ability and, with guidance, can apply the competency in common situations that present limited difficulties.

Intermediate:

Demonstrates solid knowledge and ability, and can apply the competency with minimal or no guidance in the full range of typical situations. Would require guidance to handle novel or more complex situations.

Advanced:

Demonstrates advanced knowledge and ability, and can apply the competency in new or complex situations. Guides other professionals.

Expert:

Demonstrates expert knowledge and ability, and can apply the competency in the most complex situations. Develops new approaches, methods or policies in the area. Is recognized as an expert, internally and/or externally. Leads the guidance of other professionals

Behavioral and Technical competencies are grouped into levels to differentiate between basic and more advanced proficiencies.

Proficiency Scale


Finance Behavioral Competencies

A different set of competencies and capabilities is required for all Finance professionals in the future.

Central FinanceCentral Finance

Personal Involvement and Openness Interpersonal skills Decision Making Negotiating Organizational Skills Problem Solving

Finance Behavioral Competencies


Personal Involvement and Openness

All Finance


Demonstrates a basic interest of all important aspects of specialisation or profession

Thinks things through carefully

Shows eagerness to learn, openness

Maintains “state of art” knowledge of advances in own specialisation or profession

Shares expertise with others and differentiates own opinions from the company’s position and ability to deliver

Deals with concepts and complexity comfortably

Enhances performance by applying knowledge outside core speciality area

Uses analysis to diagnose issues/problems and recommend solutions to improve performance

Seeks opportunities to influence and raise level of awareness of new developments outside the company and demonstrates this during interviews, presentations, etc.


Interpersonal Skills

All Finance


Interacts with others to ensure business requirements are being met

Builds formal and informal relationships beyond immediate contact

Can speak effectively and persuasively on controversial or complex topics

Demonstrates effective relationships throughout the organization to drive business performance


Decision Making

All Finance


Judges straightforward situations rationally, taking into account the necessary facts, policies and guidelines

Judges situations involving moderate levels of risk, considering several possible and objectively weighing alternatives

Judges situations where different parties hold different views, considering many alternatives

Makes objectives decisions that have long-term impact on the organization

Takes into account all possible sources of information, assesses risks ad all future implications


Negotiating

All Finance


Is able to influence others within the organization

Conducts internal and external negotiations without damaging relationships

Skilled at negotiating with vendors and customers ensuring all data is considered and the best interests of Lafarge are represented

Acts as resource to other Lafarge employees in negotiations and decision making


Organizational Skills

All Finance


Shows interest in understanding the “inner workings” of the organization beyond his/her area

Plans and controls own routine work on a daily basis to achieve objectives

Uses systems and resources productively

Works to build relationships with individuals in Operational and Centralized Finance as well as other departments

Knowledgeable about Company policies and procedures

Delegates tasks to promote development of employees

Encourages employees to manage projects on their own; does not micro-manage

Cognizant of cultural differences which exist within Lafarge; applies this knowledge as appropriate

Ensures understanding and compliance with Corporate policies

Establishes effective relationships at the Group level to ensure sharing of best practices

Creates an environment of trust and engagement for all team members

Communicates effectively and frequently with all team members through various mechanisms to accommodate geographical locations

Effectively achieves results utilizing both formal and informal channels in the organization

Can seek advice and “brainstorm” with individuals in other areas of the business; including those external to Finance

Structures department practices, processes and procedures to involve and enable all team members regardless of work location

Ensures employees working at a distance feel included and “connected” to their manager


Problem Solving

All Finance


Doesn’t leave issues unresolved

Seeks input from others when addressing problems

Uses creativity to resolve problems; thinks outside the box

Looks beyond the problem at hand to identify secondary issues and pro-actively addresses them


Support and Financial Processes MS

Transactional Accounting and Analysis MS

Acquisitions and Divestment AnalysisS. Rochier (MS)

IFRS and International Statutory Requirements MS

Accounting and Consolidation MS

Credit and Collection Tax Analysis on Business Decisions Income Tax Law Compliance Cross Border Tax Implications Pension Accounting Patrice

Risk and Insurance Management Patrice

Insurance captives management Patrice

Treasury Patrice

Cash Management Financing Financial Risk Management

Information Systems Lieven

Financial Systems Lieven

Support and Financial Processes MS

Transactional Accounting and Analysis MS

Acquisitions and Divestment AnalysisS. Rochier (MS)

IFRS and International Statutory Requirements MS

Accounting and Consolidation MS

Credit and Collection Tax Analysis on Business Decisions Income Tax Law Compliance Cross Border Tax Implications Pension Accounting Patrice

Risk and Insurance Management Patrice

Insurance captives management Patrice

Treasury Patrice

Cash Management Financing Financial Risk Management

Information Systems Lieven

Financial Systems Lieven

Finance Technical Competencies

BroadBroad

Financial Statement Analysis Capital Projects Analysis Process and Business Models Industry and Product Knowledge Project Management

Control

Analytical Modeling

MS +Control

Forecasting and Planning

MS +Control

Risk Assessment

Control

Internal Control Practices

VB

Financial Communication and Managerial Reporting

YBA

In Italics: Responsible for keeping updated

Financial Statement Analysis Capital Projects Analysis Process and Business Models Industry and Product Knowledge Project Management

Control

Analytical Modeling

MS +Control


MS +Control

Risk Assessment

Control


VB


YBA

In Italics: Responsible for keeping updated

SpecificSpecific

Control

Cath.


Level AUnderstand &

Produce

Level BAnalyse & report

Level CDesign & Improve

Level D Leverage & Vision

Understands content and interrelationships between the income statement, balance sheet, and cash flow statement

Utilizes tools, models, and skills to provide analysis of business unit profitability

Compares business unit profitability through budgets, forecasts and historical data

Benchmarks Internal results

Reviews and challenges income statement, balance sheet, and cash flow statement

Specifies analyses relevant to understanding the profitability of the business

Recommends solutions to meet business objectives of the unit

Benchmarks external (competition) results

Judges and extracts messages and meaning from reports and data

Provides strategic recommendations to the management team based on this information

Drives and recommends the structure on financial statements

Examples:

Implements financial analyses in Excel spreadsheet models

Gathers benchmarking information

Examples:

Reviews reports on business unit profitability using tools such as ratio analysis, trend lines, and baselines

Provides statistical analysis against targets (KPIs)

Examples:

Interprets financial statement results and makes recommendations for suitable options for operations

Examples:

Identifies key benchmarks that apply to the corporation, for consistency in analysis and reporting

Encourages the use of advanced methods of detecting issues or risks in financial data

Financial Statement Analysis



Level A Level B Level C Level D Analyzes project

alternatives using appropriate quantitative analysis Group tools.

Understands the main drivers & indicators of project profitability

Understands the Group policies for accounting and purchasing

Prepares effective documentation for capital application request (IR).

Highly conversant in calculating EVA, NPC, ROCE EPS, IRR, identifies drivers of EVA, EPS, ROCE, NPV that impact decision

Runs sensitivity analysis

Reviews and recommends, within policy, approval for capital projects. Makes effective arguments based on strategic rational and context to justify expenditures

Ensures Capital Projects Analysis results maximize Group main financial indicators (i.e. NPV, EPS, …)

Chooses the right projects in order to maximize NPV, EPS, …

Challenges projects and modifies approach proposed in order to maximize NPV, ROCE, EPS

Sets capital expenditure procedure

Identifies alternatives

Examples:

Calculates NPV, IRR, EVA, EPS, ROCE etc. Applies to equipment and portfolio (land and/or business)

Examples:

Justifies individual projects in larger business context. Assists in calculating financial impact of leasing vs. buying.

Calculates NPV, ROCE of alternatives

Examples:

Utilizes competitive analysis to influence capital project decisions

Follows up on analyses and learns from mistakes/inaccuracies

Examples:

Capital Project Analysis



Level A Level B Level C Level D Is familiar with Lafarge’s

products and operating models in own division. Understands the Group products.

Has a basic understanding of economic indicators: GDP and interest rates.

Uses understanding of similarities and differences between product line to inform decisions

Understands Lafarge’s competitive advantages/ disadvantages

Understands thoroughly the core competencies of the business unit

Familiar with competitors in own product line

Deep understanding of operating models of own product lines and products. Follows trends of competitors/ identifies their key advantages/ disadvantages

Prepares benchmarks. Has a deep

understanding of macro economic factors and their impact on the business.

Understands Lafarge and industry/ competition enough to anticipate/ react to change favorably for the Group.

Has a deep understanding of operating models and and products of all product lines.

Examples: Examples:

Identifies common business practices across product lines

Examples:

Is able to forecast trends based on KPIs.

Examples:

Is able to forecast long term trends for the group.

Is able to interpret how economic indicators impact the business in the short, medium and long term

Business Model, Industry and Product knowledge



Level A Level B Level C Level D Performs with minimal

supervision Values time and uses it

effectively and efficiently Concentrates efforts on

the most important priorities

Maintains a conscious balance between work and personal life

Leads projects of low to medium complexity to successful completion

Manages and supervises other project resources and contractors

Manages tensions and conflicts

Looks for collective success

Sets priorities accurately

Leads complex projects to successful completion

Is able to act in over-seer role for projects managed by others

Can orchestrate multiple activities at once to accomplish a goal

Gets more out of fewer resources

Commissions projects that impact company strategic direction

Provides executive sponsorship to complex projects

Integrates projects with other corporate priorities

Sees opportunities for synergy and integration where others don’t

Examples:

Keeps an agenda

Examples:

Uses software tools to keep track of projects

Examples:

His/her projects improve results

Examples:

Project Management



Level A Level B Level C Level D Uses spreadsheets and

other tools to develop understanding of quantitative issues. Understands and applies basic EVA, DCF, NPV, ROCE as appropriate

Creates complex analytical models and draws actionable conclusions from results.

Assists business partners with compiling financial impact of capital projects

Knows inter-relationships among key drivers

Validates complex analytical models against business situation

Evaluates competing proposals on relative impacts

Educates people to apply EVA principles to day-to-day and investment decisions

Uses results of analytical models to make corporate business decisions

Uses Financial Model to set performance objectives

Performs post investment audits

Examples:

Uses Group Financial Model

Examples:

Builds models for sensitivity analysis and economic cycle analysis.

Knows Lafarge’s way to measure financial performance.

Examples:

Applies models to acquisition/ divestment opportunities

Uses Statistical Process Controls

Uses linear programming Evaluates alternative

capital proposals, M&A, spin-offs, divestment

Examples:

Qualifies business decisions for buying or selling

Analytical Modeling



Level A Level B Level C Level D Understands the need for

accurate forecasting and budgeting and its impact on operations. Gathers financial data to accurately assess future financial performance

Creates budgets/ forecasts with business partners

Anticipates trends in business and adapts to meet new challenges

Determines financial impact of line performance plans

Prepares and consolidates performance plan for business unit

Provides budget methodology and high-level assumptions

Assists business partners in improvement of performance plans

Ensures effective implementation of the performance plan process to drive KPIs

Reviews and evaluates business unit strategic plans against overall Division goals

Drives the Group’s standards for budgets and forecasts and establishes parameters for performance reporting

Ensures alignment of capital expenditures with corporate objectives

Examples:

Gathers information pertinent to Management Cycle Analysis.

Develops relevant indicators

Examples:

Prepares business unit’s presentation to the Group execs. Assists business partners in interpreting data (appropriations, spending, carryovers, etc.).

Performs sensitivity analysis

Examples:

Ensures the strategic review documents meet the objectives of the Group

Examples:

Has full responsibility for Management Cycle at Division level




Level A Level B Level C Level D Understands the

importance of assessing business risks and mitigation tactics

Quantifies risk within own scope. Communicates risk assessment to management

Expert in the analysis of risk

Assists in communication of risks to external communities

Recommends mitigation strategies

Expert in the analysis of risk and the application to Lafarge businesses

Drives development of a sound risk profile

Communicates appropriate risks to internal and external communities

Examples: Examples:

Includes accurate analysis of risks in capital budget requests

Examples:

Communicates risk to Board of Directors, external auditors, shareholders or potential investors

Examples:

Risk Assessment




Understands the importance of Internal Control

Is able to manage internal control within the processes she / he is involved in (i.e. check effective implementation of Group internal control standards and identify areas of improvement of the process)

Shares information with management on internal control issues and areas of improvement

Drives the implementation of Internal Control standards within the process she / he is involved in

Drives continuous process improvement within the process she / he is involved in

Mobilizes own team to implement action plans and continuously improve IC

Has a deep understanding of all processes and related IC aspects pertaining to the organization

Drives continuous process improvement within the organization

Proactively anticipates the impact of changes on IC

Mobilizes BU Senior Management (Excom) on significant internal control issues and process improvement

Has a broad knowledge of IC at Lafarge and performs benchmarks with other Groups to define overall approach

Is an expert of processes and leads process improvement

Defines and maintains Group internal control tools

Mobilizes Group Senior Management on major internal control issues and process improvement

Examples:

Prepares procedures in line with Internal Control Standards requirements

Examples:

Performs gap analysis with Group Guidelines and implements related action plans

Reviews KPI / exception reports…. and identifies action plan to improve the process

Examples:

Organizes systematic benchmark to find areas of process improvement

His/her projects improves efficiency of processes

Examples:

Defines vision and strategy for group internal control approach




Level AUnderstand &

Produce

Level BAnalyse & report

Level CDesign & Improve

Level D Leverage & Vision

Understands the importance of accurate and coherent management & operations reporting

Interprets financial data and communicates the meaning behind the numbers

Performs consistency checks to ensure coherency

Produces first set of management reporting

Provide preliminary information (deviations, issues)

Prepares effective and timely management and operations reports

Ensures management and operations are getting the information they need on a timely and quality basis

Builds understanding and awareness of management and operations information within the organization

Trains others on financial topics

Effectively explains financial information to non-finance people

Assimilates large amount of financial information to reach conclusions

Assesses the relevance and importance of the content of reports

Is proactive in anticipating management needs for reporting

Assimilates financial information of entire firm and formulates defensible story to explain results. Ensures effective use of management and operations reports to drive corporate operational policies and growth systems development

Examples:

Helps produce Results Packages. Conveys the key elements and drivers of complex issues

Examples:

Assists business partners with interpretation of management and operation report data. Advises operations personnel in development of presentations for execs

Examples:

Presents results of financial analysis to line management

Examples:

Speaks as voice of Finance for external audiences




Level A Level B Level C Level D Has basic understanding

of finance and support processes.

Has a more detailed understanding of some processes.

Is able to see the impact of processes on the financial statements.

Is able to organize the closing process.

Can effectively manage certain processes to ensure a more efficient closing.

Consistently looks to optimize the process.

Can balance efficiency with control.

Has a deep understanding of all major financial and support processes.

Consistently uses the available tools in the most effective way.

Examples:

Basic understanding of: It systems Organisation Monthly close process Reporting tools

Examples:

Is able to identify route causes of errors in certain financial and support processes that impact the financial statements.

Is responsible for a certain part of the closing process.

Examples:

Is responsible for the closing process.

Can demonstrate they have made systematic process improvements.

Examples:

Can produce reliable financial statements at D+5

Can demonstrate a track record of reducing the closing cycle and costs.

Support and Financial processes



Level A Level B Level C Level D Can process financial

data in Lafarge systems Verifies that the

information is accurately registered in the corresponding accounts and master files. Investigates variances, identifies influence of specific drivers

Manages people and systems to reduce transaction processing costs

Is responsible for correct and timely transaction registry

Examples:

Processes A/P or A/R, G/L entries, data entry, bank reconciliations, monthly close

Examples:

Verifies balance in statements

Examples: Examples:

Transactional Accounting and Analysis



Level A Level B Level C Level D Prepares analyses of

financial impact of acquisitions/ divestments

Participates in due diligence

Understands how key Merger & Acquisition (M&A) issues impact financial priorities in own direct environment

Understands synergies quantification

Reviews financials and adjusts plan to include potential acquisitions/ divestments

Conducts due diligence Prepares pro-forma

statements Applies principles of

purchase accounting and realises the opening balance sheet accounts, validated by the auditors

Identifies and quantifies synergy opportunities

Analyzes potential acquisition/ divestment projects to recommend action

Reviews data from due diligence and open balance sheet documentation prior to submission to auditors/final validation

Aligns the new acquired structure with the Lafarge policies and processes, and takes into account the risk areas

Recommends synergy strategies

Evaluates opportunities and contributes to corporate decisions

Links analysis to external events, competing capital requirements, and corporate strategies in acquisition recommendations

Sets Lafarge M&A policies

Examples: Examples: Examples:

Identifies/ negotiates alternative business arrangements to consummate the transaction (tax, legal)

Examples:

Acquisition and Divestment Analysis



Level A Level B Level C Level D Understands basic

guidelines on statutory requirements and potential impact on Lafarge’s operations. Can link international statutory requirements to Lafarge accounting practices and cycles

Is sensitive to organizational needs while applying statutory requirements. Ensures that accounting practices align with international requirements

Effectively balances organizational needs while applying statutory requirements. Is able to convince the group of the impact of these requirements and stays ahead in effectively updating the implementation

Drives the need to closely comply with these requirements within the organization

Examples:

Enters the recurring US to IFRS converting journal entries. Gathers specific information about international requirements and checks consistency. Prepares monthly cross-border invoices

Examples:

Identifies new requirements

Promotes reconciliation showing a common language

Communicates what makes the differences

Examples:

Q&A with the Group and with the Divisions

Examples:

Develops short-term/long-term plans to ensure the optimized process to deal with different groups

IFRS and International Statutory Requirements


40Finance Competencies workshop 5 Oct 07

Level A Level B Level C Level D Knows basic rules of

consolidation Knowledge of the HFM package

as used by the Group Knowledge of HFM as a tools Basic knowledge about local

GAAP/IFRS

Knows rules of consolidation Reviews and understands

reports from the consolidation package

Checks consistency with other management analysis

Detects and solves discrepancies in the HFM package

Anticipates and can simulate the impact of an operation on the BU accounts, coordinates with other Competency Centers

Coordinates with other competency Centers to anticipate impacts on the accounts and on the tool of future significant operations impacting the UO (purchasing, treasury, tax, legal, …)

Understands fully the consolidation rules & mechanisms

Redesigns HFM : structure & reports

Good knowledge of IFRS as applied by the Group

In depth knowledge of IFRS in general

Watches out for changes, anticipates evolutions and challenges IFRS rules

Translates new IFRS rules in accounting/consolidation process

Expert for consolidation treatment of complex operations and their impact on group accounts (Figures, disclosures)

Sets policies to other departments to ensure their contribution to Group accounts

Examples:• Basic rules of consolidation :

intercompany elimination/reconciliation, exhaustivity of data

• Conversion to Group currency, consolidation methods

• Tasks performed : data entry, check blocking & non blocking controls

• Makes basic coherence checks

Examples:• Checks and challenges

Freecashflow, Variance analysis• Checks and challenges

coherence between operating /financial indicators

Examples:• Consolidation : elimination of

intercompany gains/losses, disposal valuation, net equity analysis

• Training & support to basic consolidation population

• Writes notes in the annual report

Examples:• Assigns priorities and goals for

pension staff

Examples:• Ensures that pension accounting

is properly done at Lafarge

Examples:• Advises decision makers

regarding hard choices in pensions

Accounting & ConsolidationFinance Technical Competencies


Level A Level B Level C Level D Understands the

principles of sound credit management and impact on organizational profitability. Has knowledge of laws governing credit practices

Applies knowledge of law governing credit practices. Effectively executes credit and collection activities. Applies proper accounting for credit

Assesses and manages A/R portfolio to minimize risk while maximizing profitability. Is proactive in anticipating economic trends affecting collectability

Executes secondary review to ensure integrity of A/R portfolio. Drives appropriate policies to fit the competitive environment with sensitivity to profitability and risk

Examples:

Verifies trade references on new credit application, doing Equifax, Credit Guard, and Dun and Bradstreet reports

Examples: Examples: Examples:

Credit and Collection



Level A Level B Level C Level D Understands basic

guidelines on statutory requirements and potential impact on Lafarge’s operations. Can link international statutory requirements to Lafarge accounting practices and cycles

Is sensitive to organizational needs while applying statutory requirements. Ensures that accounting practices align with international requirements

Effectively balances organizational needs while applying statutory requirements. Is able to convince the group of the impact of these requirements and stays ahead in effectively updating the implementation

Drives the need to closely comply with these requirements within the organization

Examples:

Enters the recurring US to IFRS converting journal entries. Gathers specific information about international requirements and checks consistency. Prepares monthly cross-border invoices

Examples:

Identifies new requirements

Promotes reconciliation showing a common language

Communicates what makes the differences

Examples:

Q&A with the Group and with the Divisions

Examples:

Develops short-term/long-term plans to ensure the optimized process to deal with different groups

Tax Analysis and Business Decisions (1/2)



Tax Analysis on Business Decisions (2/2)


Understands impact of tax planning on business decisions.

Provides tax advice on less complex business transactions

Identify and document tax risks & exposures

Understand transfer pricing guidelines and validates it’s correct implementation through various transactions

Provides tax driven advice on alternative ways to structure complex business transactions.

Identifies key tax related issues and corroborates findings with outside specialists as needed.

Monitor accurate tax risks reporting

Monitor effective tax rate in close coordination with consolidation team

Ensures proper tax planning at the country or regional level.

Ensures tax risk management is effective.

Handle the relationship with tax authorities

Examples:

In an asset sale,understand the company’s P&L impacts for current and deferred tax

Examples:

Asset allocation on asset deals.

Advice on a service transaction to apply a cost plus price methodology

Examples:

Asset vs. stock, basic step up transactions, structuring complex deals and evaluating cost/benefit of alternatives.

Manages due diligence and prepares recommendation to structure acquisition/sales

Examples:

Define the structures to be chosen for an acquisition in order to optimize debt push down.

Negotiate and obtain a tax ruling



Income Tax Law Compliance / Indirect Tax Compliance


Understand basic income tax law to be aware of impact in transactions

Clear understanding of current indirect and other commodity taxation laws

review calculations and monitor tax forecast prepared by accountants or SSC

Prepares moderately complex income tax returns

Identifies areas in financial transactions that have potential tax impact and advice accordingly

Effectively applies Commodity, Sales/Use tax laws and ensures correct and timely payment

Prepares complex income tax returns

Consolidate tax calculation to prepare local group position

Identifies opportunities for tax savings

Can recognize potential tax issues and advise on their provisioning

Interprets, recommends, and disseminates changes in tax laws applicable to NA business

Manage full compliance with tax laws on both domestic and international such as CFC’s rules ,or imputation of foreign tax credits

Ensure transfer pricing documentation is sufficient at country level and can be produced in a determined time frame

Manage the overall audit process by the local tax authorities

Example:

Understands gain/loss at a basic level

Understand the difference between direct and indirect tax from a P&L point of view

Example:

Understands gain/loss at medium level, reviewing tax calculations

Example:

Understands gain/loss at high level, charitable contributions, condemnations, asset price allocation

Example:

Validates annual tax provision



Cross Border Tax Implications


Understands cross-border tax implications of transactions

Able to find appropriate answers in international documentation (OECD) and relevant double taxation avoidance treaties

understand and advice on impact of international structures related to company flows, i.e.:

Dividend, royalty, interest, capital gain

Understand and manage complex situation combining international debt push down, acquisition structuring and complex interco financing

Define and implement the overall international strategy in term of debt and flows optimization

Define and implement the transfer pricing group policy, the level of documentation and appropriate guidelines

Examples:

Arm’s length understanding of concept

Examples:

Make comparison between multiple location for a new regional holding company in a joint venture environment

Examples:

Advice on an international LBO structure in which the group holds a significant stake




Risk and Insurance Management

Level A Level B Level C Level D Demonstrates a basic

knowledge of all important aspects of insurance contracts

Is able to identify and assess local risks and to ensure appropriate reporting of such risks to Corporate Risk Mgt

Develops a good understanding of Lafarge insurance schemes and loss prevention programs

Understands and is able to ensure effective implementation across its organization of Lafarge Insurance principles

Implements and monitors Group insurance programs at Bus level

Participates to loss prevention process

If need be, can actively contribute to negotiating Group insurance contracts and to selecting other service providers.

Understands insurance captive management

Defines Lafarge Insurance Principles

Proposes costs effective solutions to protect the assets & activities of the Group

Defines the structure of insurance programs (level of retention, limits,…) and loss prevention policy and process.

Places insurance programs and negotiates policy wording

Examples:

Is able to inform on premium, franchise, value of insured assets, …

Can have a contact with local brokers to get further explanations

Examples:

Ensures correct and timely process of BU’s insurance values in LROL

Ensures timely notification of claims or losses

Ensures timely payment of insurance premiums and fees

Examples: Ensures that local

coverage complies with Lafarge principles and that all assets and activities are properly insured

Recommends rules of allocation of premiums and fees within the Group in compliance with tax and legal regulations

Examples:

Selects main insurers, brokers and service providers through RFP process

Define the level of group retention, franchises, …


Treasury: Cash Management (and Short Term Financing)


Understands and analyses cash movements.

Collects and enters treasury forecasts

Can liaise with banks to get basic information on bank accounts / balances/ fees.

Check applications of bank conditions.

Ensures fund flows.

Monitors bank balances on bank accounts.

Negotiates bank conditions.

Prepares Treasury forecasts and daily treasury positions.

Ensures short term financings on a daily basis. Prepares reporting.

Negotiates short term financings (overdraft).

Understands cash investment tools.

Reports on bank activity.

Organises cash management.

Measures risks attached to cash investment.

Ensures opening and closing of bank accounts.

Manages bank mandates.

Proactively challenges treasury forecasts.

Monitors and reports on cash management/investment.

Manages bank relationship globally.

Defines policies and monitors their application.

Ensures compliance with local regulations.

Defines and implements internal control rules.



Treasury: Financing (Short, Medium and Long Term)


Checks on interest computation and interest rates applied.

Knows the basis references of interest rates in its environment.

Knows market standards for legal documentation on financing and interest computation rules.

Negotiates medium and long term financings with banks.

Studies and analyses various financing options Makes recommendations.

Monitors and reports on financings.

Defines financing policies and anticipates on financing needs based on the budgets / projects,...

Seeks for getting enhanced financings (tax exempt or other type of subsidised loans.

Decides between various financing options.

Defines and implements internal control rules.



Treasury: Financial Risk Management


• Is aware of Foreign Exchange risks.

• Follows exchange rate levels and short term evolutions.

• Monitors flows of funds related to purchases / sales of currencies and derivative instruments. control rules

• Prepares foreign exchange position.

• Measures Risk sensitivities. Understands and implements standard hedging techniques and their accounting treatment.

• Understands most hedging techniques and their accounting treatments.

• Recommends hedging strategies.

• Reports on hedging activities.

• Ensures a centralized Risk management.

• Proposes Risk Management policies and monitors their application.

• Ensures compliance with local regulations.

• Decides between various hedging options.



Level A Level B Level C Level D Is proficient with use of

typical office software tools and Internet

Advanced user of common office software packages. Advanced user of spreadsheets

Has broad knowledge of programming languages and interfaces

Is proficient in the conception and use of Databases

Can develop complex applications

Examples:

Basic user of Microsoft Suite (Word, Excel, PowerPoint, Access). Uses Lotus Notes e-mail and databases

Examples:

Advanced user of Microsoft Suite for financial modeling, presentations, etc. Advanced user of Lotus Notes (i.e.. Database development)

Examples:

Design Database reports Excel Macro instructions Visual basic

Examples:

• Design Database reports• Essbase applications

Understands the basic functionality of financial systems and ERPs.

Has knowledge of Group and Division chart of accounts

Has knowledge of the workings of Financial Systems controls

Can control reports

Effectively utilizes financial systems to achieve accurate and consistent financial reporting. Ensures appropriate controls are in place and upheld

Can give technical support and training on Financial Systems

Recommends controls to put in place

Identifies and addresses inadequacies

Understands processes

Leads in the area of Financial Controls.

Drives output of financial system.

Challenges data output

Examples:

(General ledger, accounts payable, accounts receivable, billing, fixed assets, inventory, job costing, consolidations)

Examples:• General Ledger and sub-

accounts• Stock reconciliation

Examples: Examples:• Design ERP processes• Design output from ERP

implementation

Systems


Documents

Finance Competency Model 2007