OFICINA MUNICIPAL DE ORIENTACIÓN AL TRANSEÚNTE

E X E C U T I V E B O D I E S

The Members of the Board of Management of HORNBACH-Baumarkt-AG

and their areas of responsibility: Steffen Hornbach

Graduate in Engineering Chairman

Marketing, New Stores, Auditing, Personnel Development, Public Relations

Dr. Bernd Lübcke

Graduate in Mathematics

Information Technology, Logistics, Technical Procurement

Roland Pelka

Master of Business Administration Finance and Accounting, Controlling, Investor Relations, Legal Department

Bernd Rob

Graduate in Business Administration

Stores, Store Organization, Human Resources

Manfred Valder

Businessman

Procurement and Sales, Merchandise, Environmental Issues

Executive Bodies

During the 2002/2003 financial year the Supervi- sory Board performed its duties in accordance with the requirements of the law and the articles of association, monitoring the Board of Management in its conduct of business and assisting it in an advisory capacity. The Supervisory Board ensured that it was informed on a regular basis as to the general course of business and the situation of the company. In doing so, it concerned itself in detail with the business policy of the company and consulted the Board of Management.

In its four scheduled meetings, the Supervi- sory Board held extensive discussions of the eco- nomic situation of the company, the course of business, business policy, investment and financial policy, as well as the opportunity and risk situation and risk management of the company on the basis of oral and written reports provided by the Board of Management. In addition, the Board of Man- agement provided regular written and oral reports on the situation of the company and the develop- ment of the earnings and financial situation. The Chairman of the Supervisory Board also maintained regular contact with the Chairman of the Board of Management outside meetings to discuss signifi- cant issues and also held a number of consulta- tions. It was not necessary for the Personnel and Mediation Committees to meet during the period under report.

The consolidated financial statements of HORNBACH-Baumarkt-AG as of February 28, 2003, were for the first time compiled in accor- dance with international accounting standards (IAS). The Supervisory Board concerned itself with international accounting standards (IAS) in the run up to and at its annual financial statements meet- ing. It informed itself of the principal differences to the previous accounting system and their practical implications. The Board of Management and the Supervisory Board discussed the Corporate Gover- nance Codex, i.e. the principles of responsible company management in great detail. The Board of Management and the Supervisory Board wel- come the Codex. In the context of a Code of Procedure, the Supervisory Board set out the duties of the Board of Management to provide it with information and to obtain its consent for particular transactions. The Supervisory Board and the Board of Management have submitted their Statement of Compliance pursuant to Section 161 of Stock Corporation Law (AktG). The statement testifies

that the recommendations of the German Corpo- rate Governance Codex government commission have been implemented almost exclusively. The only recommendations not implemented for rea- sons provided in the Statement of Compliance are as follows: the setting of an upper age limit for members of the Supervisory Board, the recommen- dation that no more than two former members of the Board of Management should sit on the Super- visory Board and the recommendation that the consolidated financial statements should be avail- able to the general public within 90 days of the the end of the financial year under report.

The annual financial statements and consoli- dated financial statements of HORNBACH-Bau- markt-AG as of February 28, 2003, as well as the management report and group management report, have been audited and provided with an unqualified audit opinion by the auditing company appointed at the Annual General Meeting, KPMG Deutsche Treuhand-Gesellschaft Aktiengesellschaft Wirtschaftsprüfungsgesellschaft, Frankfurt am Main. Furthermore, the auditors examined the early warning risk identification system in place at HORNBACH-Baumarkt-AG. This review led to the conclusion that the system was fulfilling its func- tion. KPMG was appointed by the Chairman of the Supervisory Board on behalf of the entire board in accordance with the resolution passed at the Annual General Meeting to audit the annual financial statements. The annual financial state- ments, the management reports and the auditors’ report were submitted to the Supervisory Board in good time for their inspection. The Audit Commit- tee examined the annual financial statements in great detail. At its subsequent meeting, the Super- visory Board also examined the documents and discussed them with the Board of Management. The auditors also attended both meetings and reported on the principal results of their audit and answered questions. The Supervisory Board expressed its agreement with the results of the audit, which contained no objections.

The Supervisory Board has examined the annual financial statements and consolidated financial statements of HORNBACH-Baumarkt-AG compiled by the Board of Management for the 2002/2003 financial year and has approved them. The annual financial statements are therefore adopted.