Deutsche Telekom AG - The 2009 financial year

PricewaterhouseCoopers Aktiengesellschaft Wirtschaftsprüfungsgesellschaft, Frankfurt/Main, and Ernst & Young GmbH Wirtschaftsprüfungsgesellschaft, Stuttgart, which were jointly appointed as auditors of the single-entity financial statements and auditors of the consolidated financial statements (external auditors) for the 2009 financial year by the shareholders’ meeting on the recommendation of the Audit Committee and proposed for appointment by the entire Supervisory Board, audited the annual financial statements as of December 31, 2009 and the management report prepared in accordance with the provisions of the German Commercial Code (Handelsgesetzbuch – HGB) as well as the consolidated financial statements as of December 31, 2009 and the Group management report prepared in accordance with IFRS as adopted by the EU and the additional requirements of German commercial law pursuant to §315a (1) HGB. They issued an unqualified audit opinion in each case. The audit of the consolidated financial statements also included the additional request to express an opinion as to whether they comply with IFRS as issued by the IASB. Before the resolution by the Audit Committee to recommend to the Supervisory Board the proposal to the shareholders’ meeting for their appointment, the auditors confirmed that there were no circumstances that may impair the independence of the auditors. They also reported on services they had performed in addition to the auditing of the financial statements. On this basis the Audit Committee reviewed and confirmed the requisite independence of the auditors. The Supervisory Board was informed of the result of this review before its resolution for the proposal to the shareholders’ meeting for appointment. The auditors submitted their reports on the nature and extent as well as the result of their audits (audit reports) to the Supervisory Board. The documentation on the aforementioned financial statements, the auditors’ audit reports, and the Board of Manage- ment’s proposal for the appropriation of net income were made available to the members of the Supervisory Board in good time. The Supervisory Board also reviewed the documents submitted by the Board of Management and the audit reports of the auditors. In preparation for the Supervisory Board’s review and resolution, the Audit Committee first concerned itself thoroughly with the aforementioned documents. At its meeting held on February 23, 2010, the Audit Committee asked the members of the Board of Management to explain thoroughly the annual financial statements, the management report, the consolidated financial statements, and the Group management report, as well as the Board of Management’s proposal for the appropriation of net income. In addition, questions posed by committee members were answered. Moreover, the auditors, who also attended the meeting, explained their audits, in particular their key audit areas defined in agreement with the Audit Committee and the Supervisory Board and the significant results of their audits, as well as their audit reports. The auditors did not identify any material weaknesses in the internal control system, the risk management system, or the accounting process. The members of the Audit Committee took cognizance of and critically reviewed the audit reports and audit opinions, and discussed them, as well as the audits themselves, with the auditors. The review included questions about the nature and extent of the audits and about the audit results. The Audit Committee satisfied itself that the audits and audit reports were compliant. In particular, it satisfied itself that the audit reports – as well as the audits conducted by the auditors – met the legal requirements. The Audit Committee shares the opinion of the auditors that there are no material weaknesses in the internal control or risk management systems. The Audit Committee recommended to the Supervisory Board that it should approve the results of the audits by the auditors and, since in its opinion there were no objections to the documents submitted by the Board of Management, approve the annual financial statements and the management report, as well as the consolidated financial statements and the consoli- dated management report and concur with the proposal of the Board of Management for the appropriation of net income. The Supervisory Board performed the final review of the annual financial statements, management report, consolidated financial statements, and Group management report as well as the Board of Management’s proposal for the appropriation of net income on February 24, 2009, taking into account the report and recommendations of the Audit Committee and the audit reports of the auditors. The members of the Board of Management also attended this meeting, explained the documents they had submitted, and answered the questions of the members of the Supervisory Board. The auditors also attended this meeting, reported on 36