Combined independent auditor's report on the 2018 financial statements and Sustainability Information

To: the shareholders and Supervisory Board of Royal BAM Group nv

Please find below the main conclusions and main features of our audit and review. For the full text of the independent auditor’s report, which includes the assurance report on sustainability, please refer to the next pages.

Summary

Conclusions

Object of audit or review

Outcome of work performed

Level of assurance


Financial statements 2018 (consolidated and company financial statements)

True and fair view

Reasonable assurance


Sustainability information 2018 in Material themes, Business conduct and transparency and Safety

Reliable and adequate view

Reasonable assurance


Sustainability information 2018 in selected chapters and appendices

Reliable and adequate view

Limited assurance


Other information, including the reports from the Executive Board and the Supervisory Board

No material misstatements

 

Main features of our audit and review

What we have done

Scope of our work

Materiality

Key audit and review matters


Audit of financial statements 2018 (consolidated and company financial statements)

Worldwide

€34 million, based on 0,5 per cent of revenue

Valuation of projects and revenue recognition, implementation of IFRS 15, valuation of deferred tax assets and valuation of land and building rights


Audit of the sustainability information 2018

Material themes, Business conduct and transparency and Safety

Specific materiality levels for each element of the sustainability information in scope

Completeness registration of safety incidents


Review of the sustainability information 2018

Selected chapters and appendices

Specific materiality levels for each element of the sustainability information in scope

No areas of specific focus


Procedures for other information

Full reports

Similar materiality levels as our audit and review scopes 

No areas of specific focus

 

Combined independent auditor’s report on the 2018 financial statements and sustainability information

To: the shareholders and Supervisory Board of Royal BAM Group nv

Our conclusions

We have audited the financial statements 2018 of Royal BAM Group nv based in Bunnik. The financial statements include the consolidated financial statements and the company financial statements. We have reviewed the sustainability information and audited selected sustainability information for the year 2018 of Royal BAM Group nv. The scope is described in the section Our Scope. A review is aimed at obtaining a limited level of assurance. An audit is aimed at obtaining a reasonable level of assurance.

In our opinion:

  • The consolidated financial statements give a true and fair view of the financial position of Royal BAM Group nv as at 31 December 2018 and of its result and its cash flows for 2018 in accordance with International Financial Reporting Standards as adopted by the European Union (EU-IFRS) and with Part 9 of Book 2 of the Dutch Civil Code;
  • The company financial statements give a true and fair view of the financial position of Royal BAM Group nv as at 31 December 2018 and of its result for 2018 in accordance with Part 9 of Book 2 of the Dutch Civil Code;
  • The sustainability information in Material themes (pages 17-18), Business Conduct and transparency (pages 39-40) and Safety (KPI: IF BAM, KPI: number of serious accidents, KPI: Safety Behaviour Audit) in chapter Social Performance (pages 30-43) in the integrated report 2018 of Royal BAM Group nv (‘the Report’) is prepared, in all material respects, in accordance with the Sustainability Reporting Standards (core option) of the Global Reporting Initiative (GRI) and the applied supplemental reporting criteria as disclosed in appendix 9.6 Sustainability reporting process and methods.

Based on our procedures performed, nothing has come to our attention that causes us to believe that the sustainability information does not present, in all material respects, a reliable and adequate view of the policy and business operations with regard to corporate social responsibility and the thereto related events and achievements for the year 2018, in accordance with the Sustainability Reporting Standards (core option) of the GRI and the applied supplemental reporting criteria as disclosed on pages 223-225 of the Report.

With respect to procedures performed based on the requirements of Part 9 of Book 2 of the Dutch Civil Code and the Dutch Standard 720, we conclude that the other information included in the Report, including the Executive Board Report and the Report from the Supervisory Board:

  • Is consistent with the financial statements and does not contain material misstatements;
  • Contains the information as required by Part 9 of Book 2 of the Dutch Civil Code.

Basis for our conclusions

We performed our assurance engagements in accordance with Dutch law, including the Dutch Standards on Auditing and the Dutch Standard 3810N Assurance-opdrachten inzake maatschappelijke verslagen’ (Assurance engagements relating to sustainability reports), which is a specified Dutch Standard that is based on the International Standard on Assurance Engagements (ISAE) 3000, “Assurance Engagements Other Than Audits or Reviews of Historical Financial Information”.

Our responsibilities under those standards are further described in the section Our responsibilities in this report.

We believe the assurance evidence we have obtained is sufficient and appropriate to provide a basis for our conclusions.

Our independence
We are independent of Royal BAM Group nv in accordance with the EU Regulation on specific requirements regarding statutory audit of public-interest entities, the Wet toezicht accountantsorganisaties (Wta, Audit firms supervision act), the “Verordening inzake de onafhankelijkheid van accountants bij assurance-opdrachten (ViO, Code of Ethics for Professional Accountants, a regulation with respect to independence)” and other relevant independence regulations in the Netherlands. This includes that we do not perform any activities that could result in a conflict of interest with our independent assurance engagements. Furthermore, we have complied with the “Verordening gedrags- en beroepsregels accountants (VGBA, Dutch Code of Ethics)”. 

Our scope

Our engagements scope
The Report of Royal BAM Group nv consists of the financial statements and other information, including the Executive Board Report and the Report from the Supervisory Board, that provides altogether an overview of the policy, activities, events and performances related to both the financial position and the sustainable development of Royal BAM Group nv during reporting year 2018. The following information in the Report has been in scope for our assurance engagements:

The consolidated financial statements comprise:

  • The consolidated statement of financial position as at 31 December 2018;
  • The following statements for 2018: the consolidated income statement, the consolidated statements of comprehensive income, changes in equity and cash flows;
  • The notes comprising a summary of the significant accounting policies and other explanatory information.

The company financial statements comprise:

  • The company statement of financial position as at 31 December 2018;
  • The company income statement for 2018;
  • The notes comprising a summary of the accounting policies and other explanatory information.

The sustainability information comprises: 

  • Reasonable assurance – Sustainability information in the following paragraphs/chapters: Material themes (pages 17-18), Business conduct and transparency (pages 39-40) and Safety (KPI: IF BAM, KPI: number of serious accidents, KPI: Safety Behaviour Audit) in chapter Social Performance (pages 30-43) - hereafter: the selected sustainability information;
  • Limited assurance – All other sustainability information reported in the paragraphs/chapters Business Model (pages 9-11), Strategy (pages 12-15), Stakeholder engagement and material themes (pages 16-19), Social performance (pages 30-43), Environmental performance (pages 45-53), Sustainability reporting processes and methods (pages 223-225), GRI Disclosure as disclosed on the website of Royal BAM Group nv – hereafter: the other sustainability information.

The other information comprises:

  • Key figures 
  • Executive Board Report
  • Report from the Supervisory Board
  • Remuneration Report
  • Other information pursuant to the requirements of Part 9 of Book 2 of the Dutch Civil Code
  • Chapter 9: appendices

Limitations to the scope of our assurance engagement on the sustainability information
The sustainability information includes prospective information, such as ambitions, strategy, plans, expectations and estimates. Inherent to prospective information, the actual future results are uncertain. We do not provide any assurance on the assumptions and achievability of prospective information in the sustainability information. 

The references to external sources or websites in the sustainability information, except for the GRI Disclosures, which are available on the website of Royal BAM Group nv, are not part of the sustainability information as reviewed by us. We therefore do not provide assurance on this information.

Reporting criteria

The financial statements and the sustainability information need to be read and understood together with the reporting criteria. Royal BAM Group nv is solely responsible for selecting and applying these reporting criteria, taking into account applicable law and regulations related to reporting. 

The reporting criteria used for the preparation of the financial statements and the sustainability information are presented below.

Consolidated financial statements

International Financial Reporting Standards as adopted by the European Union (EU-IFRS) and Part 9 of Book 2 of the Dutch Civil Code.



Company financial statements, the Executive Board Report and the Report of the Supervisory Board

Part 9 of Book 2 of the Dutch Civil Code.



Sustainability information

Sustainability Reporting Standards (core option) of the GRI and the applied supplemental reporting criteria as disclosed in appendix 9.6 Sustainability reporting process and methods on pages 223-225 of the Report.

Materiality

General
The scope of our assurance procedures is influenced by the application of materiality. Our assurance engagements aim to provide assurance about whether the financial statements and the sustainability information are free from material misstatement. Misstatements may arise due to fraud or errors. They are considered to be material if, individually or in the aggregate, they could reasonably be expected to influence the (economic) decisions of users taken on the basis of the financial statements and the sustainability information. The materiality affects the nature, timing and extent of our assurance procedures and the evaluation of the effect of identified misstatements on our conclusions.

Financial statements
For the audit of the financial statements our considerations regarding the materiality are as follows:

Materiality

€34 million (2017: €33.5 million)



Benchmark used

0.5 per cent of revenue 



Additional explanation

Based on our analyses of the common information needs of users of the financial statements, we consider profit before tax the most appropriate benchmark to determine materiality. However, profit before tax has been volatile in recent years and is not yet at a representative level, given the size of the business. For this reason we considered revenues to be a more appropriate benchmark to determine the materiality. The percentage applied is 0.5 per cent, which is at the lower end of an acceptable range.

We have also taken into account misstatements and/or possible misstatements that in our opinion are material for the users of the financial statements for qualitative reasons.

We agreed with the Supervisory Board that misstatements in excess of €1.7 million, which are identified during the audit, would be reported to them, as well as smaller misstatements that in our view must be reported on qualitative grounds.

Sustainability information
Based on our professional judgment we determined materiality levels for each relevant part of the sustainability information and for the sustainability information as a whole. When evaluating our materiality levels, we have taken into account quantitative and qualitative considerations as well as the relevance of information for both stakeholders and the organisation. 

We agreed with the Supervisory Board that misstatements which are identified during the review and which in our view must be reported on quantitative or qualitative grounds, would be reported to them.

Our scope for the group audit of the financial statements

Royal BAM Group nv is the head of a group of entities. The financial information of this group is included in the consolidated financial statements of Royal BAM Group nv.

Our group audit focused on the significant group entities located in BAM’s home countries (the Netherlands, Germany, United Kingdom, Ireland and Belgium) and BAM International with its various activities abroad. We have performed extensive audit procedures ourselves for group entities located in the Netherlands, thereby focusing on the key risk areas. Apart from focusing on significant group entities, we also reviewed and selected projects on a risk basis, thereby taking into consideration the size and nature of projects, as well as the countries in which projects are being executed.

For the foreign BAM home countries, we involved EY component auditors, who are familiar with local laws and regulations and who applied full scope audits. In order to take responsibility as group auditor in line with current auditing standards, we visited our component auditors in United Kingdom, Ireland, Germany and Belgium and furthermore, we discussed the outcome of audit procedures with all component auditors.

For BAM International, for purpose of the 2018 audit, we visited Tanzania as key location ourselves to perform audit procedures. For the Middle East business and Costa Rica, BAM has involved a local audit firm who we also visited and we reviewed their work. We concluded that we can rely on their work performed in relation to the audit of the consolidated financial statements of Royal BAM Group nv. 

As a result of the above mentioned procedures, we have covered all entities and foreign locations that are material to the consolidated financial statements of Royal BAM Group nv. In addition, we have performed analytical review procedures and made inquiries with the Executive Board with respect to some smaller locations that are not material and made sure that there are no developments or exposures that should have been covered.

By performing the procedures mentioned above at group entities, together with additional procedures at group level, we have been able to obtain sufficient and appropriate audit evidence about the group’s financial information to provide an opinion about the consolidated financial statements.

Our key audit and assurance matters

Key audit and matters are those matters that, in our professional judgment, were of most significance in our assurance procedures for the financial statements and the sustainability information. We have communicated the key audit and assurance matters to the Supervisory Board. The key audit and assurance matters are not a comprehensive reflection of all matters discussed.

These matters were addressed in the context of our assurance procedures for the financial statements and the sustainability information as a whole and to conclude thereon, and we do not provide a separate conclusion on these matters. Prior year BAM capitalised development costs related to the Gravity Based Foundations which was included as a key audit matter. In 2018 there were no significant developments related to the capitalised costs and therefore this is not included as a key audit matte

For the audit of the financial statements we identified the following key audit matters:

Valuation of projects and revenue recognition 


(Refer to pages 61-65 (Executive Board Report), page 134 (Critical accounting judgements and key sources of estimation uncertainties) and pages 139-141 (Notes to the consolidated financial statements)


Risk

How our audit addressed the matter

Key observations




BAM is involved in large and complex construction projects for which the company applies the percentage of completion method. The amount of revenue and profit recognised in a year on projects is dependent, inter alia, on the actual costs incurred, the assessment of the percentage of completion of (long-term) contracts and the forecasted contract revenue and costs to complete of each project. Furthermore, the amount of revenue and profit is influenced by the valuation of variation orders and claims. This often involves a high degree of judgment due to the complexity of projects, uncertainty about costs to complete and uncertainty about the outcome of discussions with customers on variation orders and claims, thereby taking into account the various parts of the world BAM operates in.

Our audit procedures included an assessment of the internal control environment of BAM, testing relevant controls, performing site visits, vouching project valuations and testing the Executive Board’s position against supporting documentation and BAM’s accounting policy. In cases where a high amount of judgement is involved, we gained additional comfort by comparing the Executive Board’s positions to opinions from external parties such as lawyers or surveyors and / or we looked at BAM’s track record for collecting claims. For long-term contracts, we also compared BAM’s current positions taken to the positions taken in previous year, to ensure consistency in the valuation and to perform back testing on this estimate.

Overall, we conclude that projects have been valued in accordance with IFRS as adopted by the EU, thereby taking into account the disclosures with respect to risk and uncertainty mentioned on the pages referred to above. The Report also includes references to those projects valuations considered most significant by the Executive Board.

 

Implementation of IFRS 15 


Refer to pages 107-110 and 122-127 (Summary of significant accounting policies), page 134 (Critical accounting judgements and key sources of estimation uncertainties) and 139-141 (Notes to the consolidated financial statements)


Risk

How our audit addressed the matter

Key observations




BAM has adopted IFRS 15 “Revenue from Contracts with Customers” with effect from 1 January 2018, using the full retrospective transition approach whereby 2017 financial information has been restated in the 2018 financial statements.

The impact of the accounting change was a reduction of shareholders’ equity as at 1 January 2017 by €110 million and a reduction of the 2017 net result by €26 million. 

 

Our audit procedures included the IFRS 15 restatement of the balances as of 1 January 2017 and 31 December 2017. We have paid specific attention to the recognition of variable considerations, whereby the threshold for recognition has increased from probable to highly probable. 

Furthermore we have audited whether the revenue recognition in 2018 was in accordance with IFRS 15 and have audited the relevant disclosure.

 

We agree with the restatements and the disclosures made in the Report.

We concur with the revenue recognition based on IFRS 15 including the relevant disclosures in the Report.

 

 

Valuation of deferred tax assets


Refer to page 25 (Executive board report), pages 134-135 (Critical accounting judgements and key sources of estimation uncertainties) and pages 170-172 (Notes to the consolidated financial statements)


Risk

How our audit addressed the matter

Key observations




The recognised deferred tax assets amount to €166 million at 31 December 2018 and relates to tax losses carried forward in the Netherlands and Germany. In view of recent losses in the Dutch fiscal unity, the Executive Board has re-assessed the ability to realise projected future profits to meet the recognition criteria of “convincing evidence” under IFRS. 

Estimation of future profits inherently involves a high degree of judgement. As basis for their assessment of future profits, the Executive Board used amongst others the 2019 operating plan as approved by the Supervisory Board and reduced these forecasts considerably to include appropriate risk adjustments. This has led to an impairment charge of €37 million. 

The deferred tax assets further decreased by €35 million due to future tax rate changes and expiration of the 2009 loss.

Our audit procedures included an assessment of the company’s assumptions underlying the estimated future taxable profits for their ableness and consistency with internal budgets and strategic plans for future years. We also challenged the Executive Board’s expectations of future taxable profits, challenged risk adjustments made by the Executive Board and we assessed the historical accuracy of the Executive Board’s assumptions

We note that the Executive Board expects the risk/reward ratio to improve in future years, which is gradually visible by improved order book margins. 

 

In our opinion, the final deferred tax asset assessment made by the Executive Board includes appropriate risk adjustments with respect to the profit forecasts in order to comply with the “convincing evidence” requirement of IFRS. 

 

 

Valuation of land and building rights


Refer to page 64 (Executive board report), pages 134-135 (Critical accounting judgements and key sources of estimation uncertainties) and pages 139-141 (Notes to the consolidated financial statements) 


Risk

How our audit addressed the matter

Key observations




The estimates for valuation of land and building rights relate to terms which vary from one year to more than thirty years, because of which the estimation uncertainty is significant.

 

We have assessed the calculations of the land’s net realisable values and challenged the reasonableness and consistency of the assumptions used by the Executive Board. We also determined consistency with prior years and external available information such as external appraisals and plans and decisions of government bodies. 

We also compared the Executive Board’s assumptions concerning the development of house prices with independent expectations of external parties and institutions.

In our opinion, the valuation applied by BAM is in line with IFRS as adopted by the EU.

 


For the assurance engagement on the sustainability information, we identified the following key assurance matters:

Completeness registration of safety incidents


Refer to pages 30-43 (Executive Board Report) and appendix 9.6 (Sustainability reporting process and methods)


Risk

How our audit addressed the matter

Key observations




Royal BAM Group nv uses and discloses own reporting criteria for the KPI ‘Incident Frequency BAM’ (hereinafter: IF BAM) and the ‘number of serious accidents’. The complexity of the scoping of the indicators and the decentralised organisation of BAM inherently involves risk that not all safety incidents are reported.

Our audit procedures focused on the suitability of the reporting criteria, inquiry of responsible personnel from different levels within the organisation on how BAM monitors this risk and which controls are in place to mitigate this risk. We performed testing procedures, on group and operational company level, to verify the completeness of the registered safety incidents. We have also reviewed whether the disclosures in the Report, including any inherent limitations in measurement, are adequate.

We concur with the reporting criteria applied and the disclosures made.

 

Report on other legal and regulatory requirements

Engagement
We have been appointed in the shareholders meeting on 22 April 2015 as auditors of Royal BAM Group nv as of the audit for the year 2016 and have operated as statutory auditor since that date.

No prohibited non-audit services 
We have not provided prohibited non-audit services as referred to in Article 5(1) of the EU Regulation on specific requirements regarding statutory audit of public-interest entities.

Other non-prohibited services provided 
In addition to the statutory audit of the financial statements we provided the following services:

  • Agreed upon procedures on debt covenants and other financial ratio’s;
  • Assurance on other items than the consolidated financial statements of Royal BAM Group nv (such as local statutory audits, or assurance on the Carbon footprint Scope 1 and 2 as included in the report ‘CO2 emissie inventaris’ of Royal BAM Group nv);
  • Assurance on sustainability information as described in the section “Our scope” of this report.

All other non-prohibited services provided have been pre-approved by the Audit Committee.

Responsibilities

Responsibilities of the Executive Board and the Supervisory Board
The Executive Board is responsible for the preparation and fair presentation of the financial statements in accordance with EU-IFRS and Part 9 of Book 2 of the Dutch Civil Code, and for the preparation of the other information, including the Executive Board Report in accordance with Part 9 of Book 2 of the Dutch Civil Code and the other information pursuant to Part 9 of Book 2 of the Dutch Civil Code. 

The Executive Board is also responsible for the preparation of reliable and adequate sustainability information in accordance with the Sustainability Reporting Standards of the GRI (core option) and the applied supplemental reporting criteria, including the identification of the stakeholders and the determination of material issues. The choices made by the Executive Board with respect to the scope of the sustainability information are included in appendix 9.6 Sustainability reporting processes and methods (pages 223-225) of the Report. 

Furthermore, the Executive Board is responsible for such internal control as the Executive Board determines is necessary to enable the preparation of the financial statements and the sustainability information that are free from material misstatement, whether due to fraud or errors. 

As part of the preparation of the financial statements, the Executive Board is responsible for assessing the company’s ability to continue as a going concern. Based on the financial reporting frameworks mentioned, the Executive Board should prepare the financial statements using the going concern basis of accounting unless the Executive Board either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so. The Executive Board should disclose events and circumstances that may cast significant doubt on the company’s ability to continue as a going concern in the financial statements. 

The Supervisory Board is responsible for overseeing the (financial) reporting process of Royal BAM Group nv.

Our responsibilities
Our responsibility is to plan and perform the assurance engagements in a manner that allows us to obtain sufficient and appropriate assurance evidence for our conclusions. 

Our audit of the financial statements and our audit of the selected sustainability information have been performed with a high, but not absolute, level of assurance, which means we may not detect all material errors and fraud during our audit. 

Our review of the other sustainability information is aimed to obtain a limited level of assurance. The assurance procedures performed to obtain a limited level of assurance are aimed to determine the plausibility of information and vary in nature and timing from, and are less in extent, than for a reasonable assurance engagement. The level of assurance obtained in a review is therefore substantially less than the assurance obtained in an audit.

We apply the ‘Nadere voorschriften kwaliteitssystemen’ (NVKS, Regulations for Quality management systems) and accordingly maintain a comprehensive system of quality control including documented policies and procedures regarding compliance with ethical requirements, professional standards and other relevant legal and regulatory requirements.

A further description of our responsibilities is included in the Annex to the combined independent auditor’s report.

Utrecht, the Netherlands, 19 February 2019
Ernst & Young Accountants LLP
Signed by W.H. Kerst 

Annex to the combined independent auditor’s report

Work performed

We have exercised professional judgment and have maintained professional skepticism throughout the assurance engagements performed by a multi-disciplinary team, in accordance with the Dutch Standards on Auditing and the Dutch assurance standards, ethical requirements and independence requirements. 

Our audit to obtain reasonable assurance about the financial statements (consolidated and corporate) included the following: 

  • Identifying and assessing the risks of material misstatement of the financial statements, whether due to fraud or errors, designing and performing audit procedures responsive to those risks, and obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control 
  • Obtaining an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control 
  • Evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Executive Board 
  • Concluding on the appropriateness of Executive Board’s use of the going concern basis of accounting, and based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern
  • Evaluating the overall presentation, structure and content of the financial statements, including the disclosures
  • Evaluating whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation

Our review to obtain limited assurance about the sustainability information included the following:

  • Performing an analysis of the external environment and obtaining an understanding of relevant social themes and issues and the characteristics of the entity
  • Evaluating the appropriateness of the reporting criteria used, their consistent application and related disclosures in the sustainability information. This includes the evaluation of the results of the stakeholders’ dialogue and the reasonableness of estimates made by the Executive Board
  • Obtaining an understanding of the reporting processes for the sustainability information, including obtaining a general understanding of internal control relevant to our review
  • Identifying areas of the sustainability information with a higher risk of misleading or unbalanced information or material misstatements, whether due to fraud or errors. Designing and performing further procedures aimed at determining the plausibility of the sustainability information responsive to this risk analysis. These further review procedures consisted of:
    • Interviewing the Executive Board and relevant staff at corporate and local levels responsible for the sustainability strategy, policies and results
    • Interviewing relevant staff responsible for providing the information for, carrying out internal control procedures on, and consolidating the data in the sustainability information
    • Determining the nature and extent of the review procedures for locations. For this, the nature, extent and/or risk profile of these locations are decisive. Based thereon we selected the locations to visit. The visits to multiple sites and offices of BAM’s Operating Companies in Belgium, United Kingdom and The Netherlands are aimed at, on local level, valuating source data and evaluating the design and implementation of internal controls and validation procedures
    • Reviewing, on a limited test basis, relevant internal and external documentation
    • Performing an analytical review of the data and trends
  • Evaluating the consistency of the sustainability information with the information in the Report which is not included in the scope of our review
  • Evaluating the presentation, structure and content of the sustainability information
  • Considering whether the sustainability information as a whole, including the disclosures, reflects the purpose of the reporting criteria used.

In addition to the procedures mentioned above, for the selected sustainability information we performed the following procedures to obtain reasonable assurance:

  • Obtaining a more detailed understanding of the systems and reporting processes, including obtaining an understanding of internal control relevant to our assurance engagement
  • Evaluating the design, implementation and of the relevant internal controls during the reporting year
  • Conducting more in-depth analytical procedures and substantive testing procedures on the relevant data
  • Evaluating relevant internal and external documentation, on a test basis, to determine the reliability of the selected sustainability information.

We have read the other information. Based on our knowledge and understanding obtained through our audit of the financial statements or otherwise, we have considered whether the other information contains material misstatements. By performing these procedures, we comply with the requirements of Part 9 of Book 2 of the Dutch Civil Code and the Dutch Standard 720. The scope of the procedures performed on the other information is substantially less than the scope of those performed in our audit of the financial statements.

Because we are ultimately responsible for the opinion, we are also responsible for directing, supervising and performing the group audit. In this respect we have determined the nature and extent of the audit procedures to be carried out for group entities. Decisive were the size and/or the risk profile of the group entities or operations. On this basis, we selected group entities for which an audit or review had to be carried out on the complete set of financial information or specific items.

We communicate with the Supervisory Board regarding, among other matters, the planned scope and timing of the assurance procedures and significant findings, including any significant findings in internal control that we identify during our assurance engagements. In this respect we also submit an additional report to the audit committee in accordance with Article 11 of the EU Regulation on specific requirements regarding statutory audit of public-interest entities. The information included in this additional report is consistent with our audit opinion in this auditor’s report.

We provide the Supervisory Board with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. 

From the matters communicated with the Supervisory Board, we determine those matters that were of most significance in the audit of the financial statements and the assurance engagement on the sustainability information of the current period and are therefore the key audit and assurance matters. We describe these matters in our combined independent auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, not communicating the matter is in the public interest.

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