2
Key audit matter How our audit addressed the matter
Valuation of equity investments
We refer to notes 15 and 16 in the separate financial
statements, where investments in financial assets at
fair value are presented, including equity
investments, representing shares held by the
Company. As of December 31, 2024, investments in
equity securities represent 78% of the total assets
held by the Company.
Financial investments in equity securities classified
under Level 3 of the fair value hierarchy amount to
RON 1.1 billion and consist of holdings in Romanian
companies, both listed and unlisted, but without an
active market.
The determination of the fair value of investments in
equity securities classified under Level 3 of the fair
value hierarchy was carried out based on valuation
models using the financial information of the
assessed companies available at a date prior to
December 31, 2024, which involves significant
judgments and a high degree of estimation.
These valuations were carried out by independent
appraisers designated by the Company's
management. The Company's management
performed an analysis covering the period from the
date of the valuations of the respective investments
until December 31, 2024, in order to identify
significant changes in the fair value of investments in
equity securities as of December 31, 2024.
This represented a key area of focus in our audit due
to the significant values of these investments, the
complexity involved in valuing these investments, the
significance of the professional judgments and
significant estimates used in the valuation, as well as
the reflection of changes in fair value in the individual
financial statements.
To address the key audit matter, our audit focused on evaluating
the relevant controls regarding the annual evaluation process of
investments in equity securities measured at fair value. Our
analysis of the design and implementation of the relevant
controls provided a basis for us to establish audit procedures
according to the nature, planning, and planned scope.
For significant listed equity investments, we assessed the
Company’s analyses and policies regarding the frequency of
transactions to identify securities without an active market. For
significant listed equity investments classified under Level 1 of the
fair value hierarchy, we evaluated the accuracy of the closing
price on the capital market of the shares as of December 31,
2024, or from the last available trading day at the end of the
reporting period.
For a sample of equity investments classified under Level 3 of the
fair value hierarchy and involving significant valuation
assumptions, we involved our own valuation specialists, who
analyzed the valuation methodology, the assumptions used, the
significant unobservable inputs used by the appraisers, as well as
their professional competence and independence from the
Company.
We evaluated the Company’s Management analyses for the
period subsequent to the date of the valuation reports until
December 31, 2024, to identify significant events that may have a
substantial impact on the fair value of equity investments as of
December 31, 2024.
We also evaluated whether significant changes in fair values were
accurately reflected in the separate financial statements.
In the analysis of the separate financial statements, we
considered whether they properly reflect the significant
information regarding equity investments in accordance with the
Company’s accounting policies and the requirements of IFRS 13
Fair Value Measurement ("IFRS 13"). In this regard, we assessed
the accuracy of the presentation of significant information related
to the fair value hierarchy, information on significant
unobservable and observable inputs, in line with the disclosure
requirements set out by IFRS 13.
Other Information
6. The administrators are responsible for the preparation and presentation of the other information. The other
information comprises the Administrators’ Report and the Remuneration Report but does not include the separate
financial statements and our auditor’s report thereon.
Our opinion on the separate financial statements does not cover the other information and, unless otherwise explicitly
mentioned in our report, we do not express any form of assurance conclusion thereon.
