This is guaranteed through a variety of tools, including our group-wide opportunity and risk management system that is integrated into the structural and procedural organization of our business processes. Our early risk identification system is assessed by our auditors on an annual basis.

Based on our corporate strategy, the Management Board defines the risk policy. In addition, all fully consolidated companies of the SOLARWORLD group are incorporated into our opportunity and risk management system. Notes/Scope of consolidated financial statements and legal group structure Risks are identified and monitored in a decentralized manner by the management of the operating business units. On the basis of a standardized reporting system, monthly overviews are presented to the Management Board; any current risks and opportunities are immediately notified to the Board. In close alignment with Group Controlling, the Executive Board is able to assess the impact of the identified risks and opportunities on our net assets, financial position and results of operations without delay and to initiate counter- measures where required.

Group-wide bodies to identify, analyze and handle risks and opportunities are not only the Management Board meetings but also the general strategy meetings. At these meetings, which take place several times a year, the Management Board discusses with the managing directors and board members of the subsidiary companies any possible opportunities and risks. The Group Committee, which meets once a year, involves the Management Board, the managing directors and the senior managers of the operating units. These bodies form a broad, group-wide basis for our opportunity and risk management and enable us to rapidly implement the decisions taken at all management levels.

Opportunities and risks arising from the general economic conditions are determined, evaluated, and reported to the Management Board in the form of a monthly executive summary based on market, tendency and competition analyses by the departments Investor Relations, Marketing and Distribution.

In order to minimize ecological and social risks and tap economic opportunities, we have developed an integrated sustainability management system which reports directly to the Board in its function as a control and monitoring tool.

We also operate an integrated group-wide quality and environmental management system in order to counter risks in our process chain and make quality, process and environmental standards transparent. Quality and environmental management Statistics on waste, emissions, waste water, power consumption and the consumption of consumables facilitate early detection and risk identification with regard to consumption data. Monitoring of laws and regulations against insider trading, for example, is effected by our Compliance Officer, backed by legal advice from external lawyers.

The Management Board weighs risks off against acceptable overall risks and decides whether any strategically useful risks are taken in a controlled manner in order to seize opportunities. Where the decisions taken are of fundamental importance to the company, the Supervisory Board is also involved. We thus identify developments that might jeopardize the continued existence of our company at an early point in time.

In order to limit the remaining risks, SOLARWORLD has taken out corresponding insurance cover to minimize risks. The extent of cover is regularly reviewed in order to keep pace with our steady growth.

Risk management with respect to financing instruments. In view of the worldwide financial crisis, our risk management takes account of the fact that there is a greater probability that delivery defaults, cancellations or renegotiation will arise in 2009 than in a stable economic environment. Although our strong liquidity situation ensures our safe position for further growth, suppliers and customers might be unable to fulfil their contracts due to financing difficulties. Default risks

Responsibility for minimizing risks arising from the use of various financing instruments rests with the Management Board and the managing directors and boards of the respective subsidiaries. The business units report to the management on any risks and any hedges entered into. The direct allocation of financial instruments used to specific projects enhances transparency and facilitates direct risk control.

Financial risks such as price, currency, and interest rate risks arising within the framework of our increasing international business are countered by means of general contracts, maturity structures and hedges in line with our risk management. Notes/Principles and objectives of financial risk management