FINANCIAL STATEMENTS
31.12.2020
03 REPORTOFTHEBOARDOFDIRECTORS
05 INCOMESTATEMENT
06 BALANCESHEET
07 CASHFLOWSTATEMENT
08 NOTESTOTHEFINANCIALSTATEMENTS
14 SIGNATURESANDAUDITOR’SREPORT
CONTENTS
3RAONordicOy|+358977381000|Tammasaarenkatu1,FI-00180Helsinki|[email protected]|CompanyID:FI17849377
REPORT OF THE BOARD OF DIRECTORS
1. DEVELOPMENT OF OPERATIONS DURING THE YEAR 2020
ThemainpartsofRAONordic’sbusinessoperationsin2020havebeenelectricityimportsfromRussiaandsellingittoNordicelectricitymarketinFinlandandinNorway.
In2020RAONordichasdeliveredtoNordicmarket in total2,8TWhofphysicalelectricity(7,3TWhin2019).ThegrosssalesfigurewasEUR100million(EUR322millionin2019)andtheoperatinglossisEUR0,9million(operatingprofitwasEUR3,9millionin2019).
2. MAJOR EVENTS AFTER THE BALANCE SHEET DATE
Therehavebeennoeventsafterthe31December2020thatmayinfluenceorhaveanymaterialimpactontheactivitiesofRAONordicoritsfinancialposition.
3. Estimate of the future development
ThebusinessstrategyofRAONordicOyhasnotbeenchangedduring2020.Thefocusofthecompanyisoncross-bordertradingandbusinessactivitiesrelatedtopowerinterchangeacrosstheborderconnectionsbetweenRussiaandNordiccountries.
4. Estimation of major risks
RAONordic’sbusinessriskscanbesummarizedasfollows:1. Operating risk:Operatingriskrefers to the inherentorgeneralbusinessriskofacompanysuchascountry risk, political risk and economic risk. General business risk refers to risks related to generalbusinessconcernsofregimestability,turmoil,corruption,financialtransfer,loandefault,directinvestmentandexportmarkets.Duetothenatureofthebusinessi.e.tradingelectricitywhichismainlypurchasedfromRussia,RAONordic´soperatingriskcanbeseenhigherthanmoderate.
2. Market risk: Marketriskistheriskthatisincurredduetouncertaintiesinthemarket.Uncertaintiesmayincludefluctuationsinrawmaterialandproductioncosts,demand,andpricing.Marketriskisastandardrisk borne by any firm involved inmarket driven transactions.Due to the fact thatRAONordic tradeselectricitywhichisrathervolatilecommodity,RAONordicsmarketriskcanbeseenhigh.
3. Product liability/Warranty risk: Productliabilityriskarisesfromthesaleofdefectiveproducts.Warrantyrisk refers to the risk that companies facewhencustomersmakeclaimsagainst them ifproductsand/orservicesarenotofferedaccordingtotheagreedupontermsandconditions.Duetothenatureoftheproductandthefactthattheelectricity
4. Bad debt risk: Baddebtriskistheriskthatasupplierwillnotreceivepaymentfromacustomer.WhentradingviaNordPoolSpotASandNASDAQOMXexchangesisconcerned,thebaddebtriskisregardedlow.AsRAONordic’sclientsarewellestablishedbusinesses,thebaddebtriskcanbeseenasmoderate.
5. Foreign exchange risk: Foreignexchangeriskarisesfromfluctuationsincurrencieswhereacompanybearscostsinonecurrencyandreceivesrevenueinadifferentcurrency.Duetothefactthatthephysicalelectricityisalmostpurelypurchasedandsoldineuroandfinancial tradingiscarriedoutineuro,RAONordic’sforeignexchangeriskcanbeseenasratherlow.
5. Development and research activities
RAONordicdoesnothavemajordevelopmentandresearchactivitiesduetothenatureofitsbusiness.
6. Valuation of financial instruments
ThefinancialinstrumentsarerecognizedatfairvalueaccordingtotheAccountingAct5:2a§.
Commodity risk hedging
Commodityriskhedginghasbeenappliedsincethefinancialyear2010.TheCompanyhaspartlyappliedhedgeaccountinginaccordancewithIFRS9asso-calledcashflowhedge.Achangeinthefairvalueofelectricityderivativehedgecontractproveneffectiveisentereddirectlyinshareholders’equityinfairval-uereserve,andonlyaftertherealizationoftheforecastelectricitypurchasesitisenteredintheincomestatementasanadjustmentofthehedgedpurchasesorsales.Asat31.12.2020thehedgereservefairvalueisEUR-3,2million.
Report of the Board of Directors
7. Key figures of the parent company RAO Nordic Oy business and its financial position. Personnel key figures of the parent company RAO Nordic Oy.
8. RAO Nordic Group
TherewerenochangesintheGroupstructurein2020.
9. Environmental issues
InthepasttheenvironmentalissueshavehadnomaterialimpactonthebusinessasRAONordicanditssubsidiarieshavebeenmainlyinvolvedintheenergytradingbusiness.ButbeingengagedinpurelytradingbusinessRAONordichascontinuouslylookedforpotentialinvestmentprojectsinEUcountries.NowadaysthedevelopmentstrategyoftheGroupemphasizesthegreenpowerprojectdevelopment,technologiesthatprovidethehighestenvironmentalbenefit.
4RAONordicOy|+358977381000|Tammasaarenkatu1,FI-00180Helsinki|[email protected]|CompanyID:FI17849377
10. Shares
Thesharecapitalissplitasfollows:
11. The proposal of the Board of Directors of the profit distribution
DistributableprofitisEUR42096750,77.Profitfortheyear2020isEUR6225448,48.BoardofDirectorsproposethatdividendEUR8000000,00willbepaidandremainingpartoftheprofitEUR34096750,77willbetransferredtoretainedearnings(loss)account.Nomaterialchangeshavetakenplacein thecompany’sfinancialpositionafter theendof thefinancialyear.Thecompany’sliquidityisgood,andintheviewoftheBoardofDirectorstheproposeddistributionofprofitsdoesnotendangerthefinancialstability
12. Board of Directors, Managing Directors and Auditors
ThefollowingpersonsincludedtotheBoardofthecompanyduring2020.
AlexandraPanina,ActingHeadoftheTradingUnitofPJSC“InterRAOTatianaZaltsman,HeadofCorporateEconomicPlanningDepartmentofPJSC“InterRAO”GennadyBinko,AdvisortotheChairmanoftheManagementBoardofPJSC“InterRAO”EvgenySarymsakov,HeadofInternationalLawDepartmentofPJSC“InterRAO”OlegZakataev,ManagingDirectorofRAONordicOy
AuditorhasbeenErnst&YoungOyandPasiPekkarinenasachiefauditor.
2020inthousandsofEUR
2019inthousandsofEUR
2018inthousandsofEUR
Staffcost 2684 2651 2259
Averagenumberofemployees 11 11 11
2020 2019
TheCompanyhasoneseriesofshares(1vote/share) 1305shares 1305shares
Allsharesareequallyentitledtodistributionofdividend
REPORT OF THE BOARD OF DIRECTORS
2020inthousandsofEUR
2019inthousandsofEUR
2018inthousandsofEUR
Netturnover 100047 322206 332508
Operatingprofit -871 3914 3871
Netprofit 6225 9711 6866
Operatingprofit% -0,9 1,2 1,2
Returnonequity% 15,5 17,9 18,7
Equitytoassetsratio% 60,9 86,1 54,8
5RAONordicOy|+358977381000|Tammasaarenkatu1,FI-00180Helsinki|[email protected]|CompanyID:FI17849377
INCOME STATEMENT
CurrencyEUR Note1.1.2020-31.12.2020
1.1.2019-31.12.2019
NET TURNOVER 3.1 100 046 560.45 322 201 734.41
Otheroperatingincome 0.00 4304.68
RawmaterialsandservicesRawmaterialsandconsumablesPurchasesduringthefinancialyear -97113573.55 -314458096.68
-97 113 573.55 -314 458 096.68
StaffexpensesWagesandsalaries
3.2-2683891.60 -2651160.34
SocialsecurityexpensesPensionexpenses -373978.26 -432681.87
Othersocialsecurityexpenses -69058.02 -63564.40
-3 126 927.88 -3 147 406.61
Depreciationandreductioninvalue 3.3
Depreciationaccordingtoplan -6578.52 -8771.36
-6 578.52 -8 771.36
Otheroperatingcharges 3.4 -670800.77 -677774.27
CurrencyEUR Note1.1.2020-31.12.2020
1.1.2019-31.12.2019
OPERATING PROFIT (LOSS) -871 320.27 3 913 990.17
FinancialincomeandexpensesIncomefromgroupundertakings 3.5 7140000.00 5916000.00
Otherinterestandfinancialincome
Fromothers 122970.33 177555.46
InterestandotherfinancialexpensesForgroupcompanies 3.5 -50814.20 -180712.33
Forothers -115387.38 -115656.28
7 096 768.75 5 797 186.85
PROFIT(LOSS)BEFOREAPPROPRIATIONSANDTAXES
6225448.48 9711177.02
PROFIT (LOSS) FOR THE FINANCIAL YEAR 6 225 448.48 9 711 177.02
Income statement
6RAONordicOy|+358977381000|Tammasaarenkatu1,FI-00180Helsinki|[email protected]|CompanyID:FI17849377
AssetsCurrencyEUR Note
31.12.2020 31.12.2019
NON-CURRENT ASSETS Tangibleassets 4.1
Machineryandequipment 19735.48 26314.00
Othertangibleassets 3800.00 3800.00
23 535.48 30 114.00
Investments 4.2
Holdingsingroupundertakings 34678980.12 34678980.12
34 678 980.12 34 678 980.12
34702515.60 34709094.12
CURRENT ASSETS Debtors
Long-term
Deferredtaxassets 794135.64 0.00
794135.64 0.00
Short-term 4.3
Tradedebtors 437701.46 1245778.47
Otherdebtors 14257806.74 11589769.18
Prepaymentsandaccruedincome 1892991.78 5712817.19
16 588 499.98 18 548 364.84
Cashinhandandatbanks 13932805.42 9910104.36
31315441.04 28458469.20
ASSETS TOTAL 66 017 956.64 63 167 563.32
LiabilitiesCurrencyEUR Note
31.12.2020 31.12.2019
CAPITAL AND RESERVES 5.1
Subscribedcapital
Subscribedcapital 1305000.00 1305000.00
1 305 000.00 1 305 000.00
Fairvaluereserve -3176542.56 5211302.74
Legalreserve 396.63 396.63
Retainedearnings(loss) 35871302.29 38166125.27
Profit(loss)forthefinancialyear 6225448.48 9711177.02
40 225 604.84 54 394 001.66
CREDITORS
Short-term
Tradecreditors 1834743.74 2026281.29
Amountsowedtogroupundertakings 5.2 22000371.58 5000000.00
Deferredtaxliabilities 0.00 1302825.68
Othercreditors 69816.84 241628.34
Accrualsanddeferredincome 5.3 1887419.64 202826.35
25 792 351.80 8 773 561.66
25792351.80 8773561.66
LIABILITIES TOTAL 66 017 956.64 63 167 563.32
Balance sheetBALANCE SHEET
7RAONordicOy|+358977381000|Tammasaarenkatu1,FI-00180Helsinki|[email protected]|CompanyID:FI17849377
CASH FLOW STATEMENT
Cash flow statement
CurrencyTEUR1.1.2020-31.12.2020
1.1.2019-31.12.2019
Profitbeforetax 6225 9711
Depreciation 7 9
Financialitems -7097 -5797
-865 3 923
Decreaseinreceivable 1166 2361
Decreaseinpayable 18 -1438
Increaseinfairvaluehedgereserve -8388 8022
-8 069 12 868
Interestpaid -138 -291
Interestreceived 0 0
Dividendsreceived 7140 5916
Incometaxpaid 0 0
Net cash from operating -1 067 18 493
Short-termborrowings 22000 25000
Loanrepaid -5000 -45000
Dividendspaid -12006 0
Defaultfundloss/profit 123 177
Exchangerate -27 -10
Net cash from financial 5 090 -19 833
CurrencyEUR1.1.2020-31.12.2020
1.1.2019-31.12.2019
Net increase in cash 4 023 -1 340
Balance 31.12.2019 9 910 11 250
Balance 31.12.2020 13 933 9 910
8RAONordicOy|+358977381000|Tammasaarenkatu1,FI-00180Helsinki|[email protected]|CompanyID:FI17849377
Notes to the preparation of the financial statements:
Valuation and periodization principles and methods:
Thenon-currentassetshavebeenstatedatcostandinventoriesarestatedatthelowerofcostandrealisablevalueby following thefifoprincipleand the lowestvalueprincipleof the5paragraph6§1moment.
Theacquisitioncostofthenon-currentpropertywillbedepreciatedaccordingtoplan.Thedepreciationplanisdeterminedbyexperience.Theremainderoftheacquisitioncostandresidualvaluewillbedepreciatedduringtheestimatedusefullife. Derivativesareinitiallyrecognisedatfairvalueonthedateaderivativecontractisenteredintoandaresubsequentlyremeasuredattheirfairvalue.Thefairvalueofelectricityderivativesisbasedonquotedelectricitymarketpricesattheclosingdate.Fairvaluesofoptionsaredeterminedbyusingoptionvalu-ationmodels.Themethodofrecognisingtheresultinggainorlossdependsonwhetherthederivativeisdesignatedasahedginginstrument.
Cash flow hedge
Theeffectiveportionofchangesinthefairvalueofelectricityderivativesthataredesignatedandqualifyascashflowhedgesarerecognisedinequity.Thegainorlossrelatingtotheineffectiveportionisrecognisedimmediatelyintheincomestatement.
Derivatives that are not accounted for under hedge accounting
Fairvaluechangesoftheseelectricityderivativeinstrumentsarerecognizedintheincomestatement.
Commodity risk hedging
Commodityriskhedginghasbeenappliedduringthefinancialyear2010.ThecompanyhaspartlyappliedhedgeaccountinginaccordancewithIFRS9asso-calledcashflowhedge.
Derivatives
RAONordictradesderivativesforthehedgingofsellingpricesofphysicalimportfromRussia.ThehedgereservewasvaluedatthenetamountofEUR-3176542,56asat31.12.2020.
Deferred tax
Thedeferredtaxamountisrecognisedonthefairvalueofgrosshedgereserveacknowledgedtobeeffec-tiveattheendofeachreportingperiod.ThetaxrateisFinnishcorporateincometaxrate20%.
Notes to the company which is member of the Group:
Mother company:
PJSC“INTERRAOUES”,BolshayaPirogovskayastr.,27/3,119435Moscow,RussiaistheMotherCompanyofRAONordicOy.
ThecopyoftheGroupFinancialStatementoftheMotherCompanyisavailableattheabovementionedaddress.
RAONordicOyhasnotpreparedtheGroupFinancialStatementduetotheaccountinglaw(changed30.12.2015)chapter6§1.5.
Notes to the financial statements of 31.12.2020NOTES TO THE FINANCIAL STATEMENTS
9RAONordicOy|+358977381000|Tammasaarenkatu1,FI-00180Helsinki|[email protected]|CompanyID:FI17849377
Notes to the financial statements of 31.12.2020NOTES TO THE FINANCIAL STATEMENTS
3.1 Notes to the revenue:
3.2 Notes to the personnel:
3.3 The basis of the depreciation according to plan and changes:
3.4 Other operating charges
3.5 Total income and costs from the investments in the group and affiliated companies:
Revenuesbysegmentofbusiness: 31.12.2020
31.12.2019
Electricitytrading 80360198.75 302292748.22
Profitfromfinancialtrading 19686361.70 19908986.19
100 046 560.45 322 201 734.41
Numberofemployees: 31.12.2020
31.12.2019
Numberofpersonsthecompanyhasemployedduringthefinancialyearontheaverage.
11 11
Item:Useful
lifeyearsDepreciationpercentage
Depreciationmethod
Machineryandequip. 25% residualvaluedepr.
Revenuesbygeographicalmarket: 31.12.2020
31.12.2019
Russia 201029.75
Finland 110598.15 183187.08
Norway 80928306.15 302985063.46
Sweden 18806626.40 19033483.87
100 046 560.45 322 201 734.41
31.12.2020
31.12.2019
Optionalsocialexpenses 46992.22 79705.30
Expensesofpremises 87418.49 92733.24
Expensesofuseofsoftware,machineryandequipment 139182.85 128971.08
Travelexpenses 13494.05 18011.82
Entertainmentcost 4416.73 13558.77
Marketingexpenses 4189.32 5392.27
Administrationexpenses 375107.11 339401.79
670 800.77 677 774.27
31.12.2020
31.12.2019
Financialincome 7140000.00 5916000.00
Interestincome 0.00 0.00
Interestexpenses -50814.20 -180712.33
7 089 185.80 5 735 287.67
Staffcosts: 31.12.2020
31.12.2019
Wagesandsalaries 2683891.60 2651160.34
Pensioncosts 373978.26 432681.87
Othersocialsecuritycosts 69058.02 63564.40
Total 3 126 927.88 3 147 406.61
Notes to the income statement:
10RAONordicOy|+358977381000|Tammasaarenkatu1,FI-00180Helsinki|[email protected]|CompanyID:FI17849377
Notes to the balance sheet assets:
TangibleassetsMachineryandequipment
Acquisitioncost1.1.2020 588199.78
Additions 0.00
Disposals 0.00
Acquisition cost 31.12.2020 588 199.78
Accdepratthebeginningofthefiscalyear 561885.78
Depreciationsofthefiscalyear 6578.52
Depreciationsofthedisposeditems 0.00
Accumulated Depreciation at the end of the fiscal year 568 464.30
Costattheendofthefiscalyear 588199.78
Accdeprattheendofthefiscalyear -568464.30
Book value 31.12.2020 19 735.48
Book value 31.12.2019 26 314.00
31.12.2020
31.12.2019
Pieceofart 3800.00 3800.00
Expensedsmallacquisitions 9831.31 9759.73
Thetotalresidualvalueofthemachineryandequipment: 31.12.2020
31.12.2019
Machineryandequipmentinbalancesheetintotal, 19735.48 26314.00
ofwhichtheresidualvalueis: 19735.48 26314.00
Thedepreciationsofthenon-currentassetsandothertangibleassets: 31.12.2020
31.12.2019
Machineryandequipment 6578.52 8771.36
Otherintangibleassets 0.00 0.00
Depreciationstotal 6 578.52 8 771.36
4.2 Investments
4.1 Intangible and tangible assets
Groupcompanies
Acquisitioncost1.1.2020 34678980.12
Disposals
Acquisitioncost31.12.2020 34678980.12
Reductioninvalue
Book value 31.12.2020 34 678 980.12
31.12.2020 31.12.2019
Nameofsubsidiary UABInterRAOLietuva UABInterRAOLietuva
Shareholding% 51.00% 51.00%
Equity 15412780.00 20716126.00
Netresultofthereportingperiod 11043340.00 13633369.00
NOTES TO THE FINANCIAL STATEMENTS
Notes to the financial statements of 31.12.2020
11RAONordicOy|+358977381000|Tammasaarenkatu1,FI-00180Helsinki|[email protected]|CompanyID:FI17849377
31.12.2020
31.12.2019
Nasdaqfuturessettlement 0,00 2231025,30
VATreceivables 416510,96 457426,73
Securitydeposits 13841295,78 8901317,15
14 257 806,74 11 589 769,18
31.12.2020
31.12.2019
Accruedinterestreceivables 0.00 0.00
Hedgingassets 0.00 302891.25
Prepayments 1892991.78 5409925.94
Otherreceivables 0.00 0.00
1 892 991.78 5 712 817.19
31.12.2020
31.12.2019
Electricitytradingreceivable 1892991,78 5409925,94
Loanreceivables 0,00 0,00
Accruedincome 0,00 0,00
1 892 991,78 5 409 925,94
4.3 Receivables from group companies
Notes to the financial statements of 31.12.2020NOTES TO THE FINANCIAL STATEMENTS
Notes to the hedged financial instrumentsDerivatives
Fairvalue31.12
AdjusmentsinIncomeStatement
Adjustmentsinfairvaluereserve
Electricityderivatives(1000e) -451 -451
Thefairvaluereserveinequityon31December2020alsoincludessettlementsofthenetvalueofelectricity futurescontracts included inhedgeaccounting totalingEUR-3.5million (31December2019:EUR6.2million).
Other debtors:
The material items in accrued short-term receivables:
Fairvalue31.12
AdjusmentsinIncomeStatement
Adjustmentsinfairvaluereserve
Electricityderivatives(1000e) 303 303
Electricity derivatives 2020
Electricity derivatives 2019
12RAONordicOy|+358977381000|Tammasaarenkatu1,FI-00180Helsinki|[email protected]|CompanyID:FI17849377
Distributableprofit 31.12.2020
31.12.2019
Retainedearnings 35871302.29 38166125.27
Profit/lossforthefiscalyear 6225448.48 9711177.02
Total 42 096 750.77 47 877 302.29
5.1 Notes to the liabilities:
Equity: 31.12.2020
31.12.2019
Subscribedcapital
Sharecapital1.1 1305000.00 1305000.00
Share capital 31.12 1 305 000.00 1 305 000.00
Legalreserve1.1 396.63 396.63
Legal reserve 31.12 396.63 396.63
Subscribed capital at the end of the fiscal year 1 305 396.63 1 305 396.63
Fair value reserve 1.1 5211302.74 -2810619.07
Additions 8021921.81
Decrease -8387845.30
Fair value reserve 31.12 -3 176 542.56 5 211 302.74
Retainedearnings1.1 47877302.29 38166125.27
Profitdistribution -12006000.00
Retainedearnings31.12 35871302.29 38166125.27
Profit/lossforthefiscalyear 6225448.48 9711177.02
Retained earnings at the end of the fiscal year 42 096 750.77 47 877 302.29
Total equity 40 225 604.84 54 394 001.66
Notes to the financial statements of 31.12.2020NOTES TO THE FINANCIAL STATEMENTS
31.12.2020
31.12.2019
Purchasepayables 0.00 0.00
Accruals 0.00 0.00
Loans 22000000.00 5000000.00
22 000 000.00 5 000 000.00
5.2 Amounts owed to group undertakings
13RAONordicOy|+358977381000|Tammasaarenkatu1,FI-00180Helsinki|[email protected]|CompanyID:FI17849377
Notes to the financial statements of 31.12.2020NOTES TO THE FINANCIAL STATEMENTS
31.12.2020
31.12.2019
Hedgingliabilities 1710566.50 0.00
Salaryaccrualsincludingsocialcosts 176853.14 202826.35
Total 1 887 419.64 202 826.35
31.12.2020
31.12.2019
VATliability 23178.06 180095.26
Payrolltaxliabilities 46638.78 61533.08
Total 69 816.84 241 628.34
Liabilities 31.12.2020
31.12.2019
Rentofpremises Rentofpremises
Tobepaidduringthenextfiscalyear 45100.02 44873.54
Tobepaidwithin2-5years 0.00 0.00
45 100.02 44 873.54
5.3 The material items in accrued payables
Rentofmachineryandit-programs
Rentofmachineryandit-programs
Tobepaidduringthenextfiscalyear 31695.11 32424.26
Tobepaidwithin2-5years 35146.56 17077.40
66 841.67 49 501.67
Total 111 941.68 94 375.21
TheMembersoftheBoardandtheManagingDirectordonothaveaseparatepensionplan.TheywillretireaccordingtothepensionlawofFinland.
Salariesandothercompensationofmanagingdirectorandmembersoftheboard: 31.12.2020
31.12.2019
976915.00 937820.97
Auditors’fee: 31.12.2020
31.12.2019
Feeforannualaudit,Ernst&YoungOyCharteredAccountants
16400.00 33050.00
Receiptcode Storage
BankreceiptsNordea 11 paperreceiptsinfolders
Salesreceipts 30 paperreceiptsinfolders
Purchasereceipts 55 paperreceiptsinfolders
AutomaticVAT-postings 99 paperreceiptsinfolders
Memorandums 90 paperreceiptsinfolders
List of book-keeping files and storage method:
Dailybook ADP-reports
Generalledger ADP-reports
Accountsreceivable ADP-subaccounting
Accountspayable ADP-subaccounting
Payrollaccounting ADP-subaccounting
Financialstatements Bindedbook
SpecificationstoFinancialStatements Bindedbook
14RAONordicOy|+358977381000|Tammasaarenkatu1,FI-00180Helsinki|[email protected]|CompanyID:FI17849377
Report on the Audit of Financial Statements
TotheAnnualGeneralMeetingofRAONordicOy
Opinion
WehaveauditedthefinancialstatementsofRAONordicOy(businessidentitycode1784937-7)fortheyearended31December,2020.Thefinancialstatementscomprisethebalancesheet,incomestatement,cashflowstatementandnotes.
Inouropinion,thefinancialstatementsgiveatrueandfairviewofthecompany’sfinancialperformanceandfinancialpositioninaccordancewiththelawsandregulationsgoverningthepreparationoffinancialstatementsinFinlandandcomplywithstatutoryrequirements.
Basis for Opinion
WeconductedourauditinaccordancewithgoodauditingpracticeinFinland.OurresponsibilitiesundergoodauditingpracticearefurtherdescribedintheAuditor’sResponsibilitiesfortheAuditofFinancialStatementssectionofourreport.WeareindependentofthecompanyinaccordancewiththeethicalrequirementsthatareapplicableinFinlandandarerelevanttoouraudit,andwehavefulfilledourotherethicalresponsibilitiesinaccordancewiththeserequirements.Webelievethattheauditevidencewehaveobtainedissufficientandappropriatetoprovideabasisforouropinion.
Responsibilities of the Board of Directors and the Managing Director for the Financial Statements
TheBoardofDirectorsandtheManagingDirectorareresponsibleforthepreparationoffinancialstatementsthatgiveatrueandfairviewinaccordancewiththelawsandregulationsgoverningthepreparationof financialstatementsinFinlandandcomplywithstatutoryrequirements.TheBoardofDirectorsandtheManagingDirectorarealsoresponsibleforsuchinternalcontrolastheydetermineisnecessarytoenablethepreparationoffinancialstatementsthatarefreefrommaterialmisstatement,whetherduetofraudorerror.
Inpreparingthefinancialstatements,theBoardofDirectorsandtheManagingDirectorareresponsibleforassessingthecompany’sabilitytocontinueasgoingconcern,disclosing,asapplicable,mattersrelatingtogoingconcernandusingthegoingconcembasisofaccounting.Thefinancialstatementsarepreparedusingthegoingconcernbasisofaccountingunlessthereisanintentiontoliquidatethecompanyorceaseoperations,orthereisnorealisticalternativebuttodoso.
Auditor’s Responsibilities for the Audit of Financial Statements
Ourobjectivesaretoobtainreasonableassuranceonwhetherthefinancialstatementsasawholearefreefrommaterialmisstatement,whetherduetofraudorerror,andtoissueanauditor’sreportthatincludesouropinion.Reasonableassuranceisahighlevelofassurance,butisnotaguaranteethatanauditconductedinaccordancewithgoodauditingpracticewillalwaysdetectamaterialmisstatementwhenitexists.Misstatementscanarisefromfraudorerrorandareconsideredmaterialif,individuallyorinaggregate,theycouldreasonablybeexpectedtoinfluencetheeconomicdecisionsofuserstakenonthebasisofthefinancialstatements.
Aspartofanauditinaccordancewithgoodauditingpractice,weexerciseprofessionaljudgmentandmaintainprofessionalskepticismthroughouttheaudit.Wealso:
• Identifyandassesstherisksofmaterialmisstatementofthefinancialstatements,whetherduetofraudorerror,designandperformauditproceduresresponsivetothoserisks,andobtainauditevidencethatissufficientandappropriatetoprovideabasisforouropinion.Theriskofnotdetectingamaterialmisstatementresultingfromfraudishigherthanforoneresultingfromerror,asfraudmayinvolvecollusion,forgery,intentionalomissions,misrepresentations,ortheoverrideofinternalcontrol.
• Obtainanunderstandingofinternalcontrolrelevanttotheauditinordertodesignauditproceduresthatareappropriateinthecircumstances,butnotforthepurposeofexpressinganopinionontheeffectivenessofthecompany’sinternalcontrol.
• Evaluatetheappropriatenessofaccountingpoliciesusedandthereasonablenessofaccountingestimatesandrelateddisclosuresmadebymanagement.
• ConcludeontheappropriatenessoftheBoardofDirectors’andtheManagingDirector’suseofthegoingconcernbasisofaccountingandbasedontheauditevidenceobtained,whetheramaterialuncertaintyexistsrelatedtoeventsorconditionsthatmaycastsignificantdoubtonthecompany’sabilitytocontinueasagoingconcern.Ifweconcludethatamaterialuncertaintyexists,wearerequiredtodrawattentioninourauditor’sreporttotherelateddisclosuresinthefinancialstatementsor,ifsuchdisclosuresareinadequate,tomodifyouropinion.Ourconclusionsarebasedontheauditevidenceobtaineduptothedateofourauditor’sreport.However,futureeventsorconditionsmaycausethecompanytoceasetocontinueasagoingconcern.
• Evaluatetheoverallpresentation,structureandcontentofthefinancialstatements,includingthedisclosures,andwhetherthefinancialstatementsrepresenttheunderlyingtransactionsandeventssothatthefinancialstatementsgiveatrueandfairview.
Auditor’s report (Translation of the Finnish original)AUDITOR’S REPORT
15RAONordicOy|+358977381000|Tammasaarenkatu1,FI-00180Helsinki|[email protected]|CompanyID:FI17849377
AUDITOR’S REPORT
Wecommunicatewiththosechargedwithgovernanceregarding,amongothermatters,theplannedscopeandtimingoftheauditandsignificantauditfindings,includinganysignificantdeficienciesininternalcontrolthatweidentifyduringouraudit.
Other reporting requirements
Otherinformation
TheBoardofDirectorsandtheManagingDirectorareresponsiblefortheotherinformation.Theother informationcomprisesthereportoftheBoardofDirectors.
Ouropiniononthefinancialstatementsdoesnotcovertheotherinformation.
Inconnectionwithourauditofthefinancialstatements,ourresponsibilityistoreadtheotherinformationand,indoingso,considerwhethertheotherinformationismateriallyinconsistentwiththefinancialstatementsorourknowledgeobtainedintheaudit,orotherwiseappearstobemateriallymisstated.OurresponsibilityalsoincludesconsideringwhetherthereportoftheBoardofDirectorshasbeenpreparedinaccordancewiththeapplicablelawsandregulations.
Inouropinion,theinformationinthereportoftheBoardofDirectorsisconsistentwiththeinformationinthefinancialstatementsandthereportoftheBoardofDirectorshasbeenpreparedinaccordancewiththeapplicablelawsandregulations.
If,basedontheworkwehaveperformed,weconcludethatthereisamaterialmisstatementofthereportoftheBoardofDirectors,wearerequiredtoreportthatfact.Wehavenothingtoreportinthisregard.
Helsinki8.2.2021
Ernst&YoungOyAuthorizedPublicAccountantFirm
PASI PEKKARINEN
PasiPekkarinenAuthorizedPublicAccountant
RAO Nordic OyTammasaarenkatu 100180 HELSINKIRegistration number: 1784937-7
Editor: Evgenia KhashchanskayaDesign: idmgroup.fi