Independent auditor's report and assurance report
Dear shareholders and supervisory board of Alliander N.V.,
We were engaged by the supervisory board as auditor of Alliander N.V. as of the audit for year 2016 and have therefore audited the financial statements 2021. Furthermore the management board engaged us to provide assurance on a selection of non-financial information in the Annual Report 2021.
Our reports in relation to both assignments, namely the auditor’s report on the financial statements 2021 and the assurance report on the non-financial information, are included below.
Independent auditor's report
To the shareholders and the supervisory board of Alliander N.V.
Report on the audit of the financial statements 2021 included in the Annual Report
We have audited the financial statements 2021 of Alliander N.V., based in Arnhem. The financial statements comprise the consolidated financial statements and the company financial statements.
In our opinion:
The accompanying consolidated financial statements give a true and fair view of the financial position of Alliander N.V. as at 31 December 2021, and of its result and its cash flows for 2021 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 accompanying company financial statements give a true and fair view of the financial position of Alliander N.V. as at 31 December 2021, and of its result for 2021 in accordance with Part 9 of Book 2 of the Dutch Civil Code.
The consolidated financial statements comprise:
The consolidated statement of financial position as at 31 December 2021.
The following statements for 2021: the consolidated balance sheet, 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 balance sheet as at 31 December 2021.
The company profit and loss account for 2021.
The company statement of comprehensive income.
The notes comprising a summary of the accounting policies and other explanatory information.
Basis for our opinion
We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing. Our responsibilities under those standards are further described in the "Our responsibilities for the audit of the financial statements" section of our report.
We are independent of Alliander N.V. 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. Furthermore, we have complied with the Verordening gedrags- en beroepsregels accountants (VGBA, Dutch Code of Ethics).
We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Information in support of our opinion
We designed our audit procedures in the context of our audit of the financial statements as a whole and in forming our opinion thereon. The following information in support of our opinion was addressed in this context, and we do not provide a separate opinion or conclusion on these matters.
Based on our professional judgement we determined the materiality for the financial statements as a whole at € 25 million. The materiality is based on 8% of profit before tax. 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 € 1,25 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.
Scope of the group audit
Alliander N.V. is at the head of a group of entities. The financial information of this group is included in the consolidated financial statements of Alliander N.V..
Our group audit mainly focused on significant group entities Alliander N.V. and Liander N.V. We have performed audit procedures ourselves at group entities Alliander N.V. and Liander N.V. and performed review procedures or specific audit procedures at other group entities.
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.
Audit approach fraud risks
We identified and assessed the risks of material misstatements of the financial statements due to fraud. During our audit we obtained an understanding of the entity and its environment and the components of the system of internal control, including the risk assessment process and management’s process for responding to the risks of fraud and monitoring the system of internal control and how the supervisory board exercises oversight, as well as the outcomes.
We evaluated the design and relevant aspects of the system of internal control and in particular the fraud risk assessment, as well as among others the code of conduct, whistle blower procedures and incident registration. We evaluated the design and the implementation and, where considered appropriate, tested the operating effectiveness, of internal controls designed to mitigate fraud risks.
As part of our process of identifying fraud risks, we evaluated fraud risk factors with respect to financial reporting fraud, misappropriation of assets and bribery and corruption in close co-operation with our forensic specialists. We evaluated whether these factors indicate that a risk of material misstatement due to fraud is present.
We identified the following fraud risks and performed the following specific procedures:
Based on our work and the risk assumed in the auditing standards, we considered the assumed fraud risks related to management's breach of internal controls, including whether there are indications of tendency in the group's management that may pose a risk of a material misstatement resulting from fraud.
Our audit procedures with respect to these fraud risks focused on an evaluation of the design and implementation of the relevant internal control measures to mitigate these risks.
We also performed additional substantive work, including testing journal entries, assessing estimates for trends (including a retrospective review of significant estimates from previous financial year), substantiating adjustments made during the preparation of the financial statements.
We build into our audit an element of unpredictability. We also considered the outcome of other audit procedures and evaluated whether any findings were indicative of fraud or non-compliance with laws and regulations.
We considered the available information and made inquiries from members of the Executive Board, management (including Legal and Internal Audit) and the Supervisory Board. This did not reveal any indications of fraud that could lead to a material misstatement due to fraud.
Audit approach fraud risks compliance with laws and regulations
We assessed the laws and regulations relevant to the Company through discussion with the Legal department, reading minutes and reports of internal audit.
Where material to the related financial statements, based on our risk assessment procedures and while realizing that the effect of non-compliance could considerably vary, we considered the following laws and regulations: adherence to (corporate) tax law and financial reporting regulations, the requirements under the International Financial Reporting Standards as adopted by the European Union (EU-IFRS) and Part 9 of Book 2 of the Dutch Civil Code, as being laws and regulations with a direct impact on the financial statements.
We obtained sufficient appropriate audit evidence regarding provisions of those laws and regulations generally recognized to have a direct effect on the financial statements.
Apart from these, the Group is subject to other laws and regulations where the consequences of non-compliance could have a material effect on amounts and/or disclosures in the financial statements, for instance, through imposing fines or litigation.
Our procedures are more limited with respect to these laws and regulations that do not have a direct effect on the determination of the amounts and disclosures in the financial statements. Compliance with these laws and regulations may be fundamental to the operating aspects of the business, to the Group's ability to continue its business, or to avoid material penalties (e.g., compliance with the terms of operating licenses and permits or compliance with environmental regulations) and therefore non-compliance with such laws and regulations may have a material effect on the financial statements. Our responsibility is limited to undertaking specified audit procedures to help identify non-compliance with those laws and regulations that may have a material effect on the financial statements. Our procedures are limited to (i) inquiry of management, the Supervisory Board, the Executive Board and others within the company as to whether the company is in compliance with such laws and regulations and (ii) inspecting correspondence, if any, with the relevant licensing or regulatory authorities to help identify non-compliance with those laws and regulations that may have a material effect on the financial statements.
Naturally, we remained alert to indications of (suspected) non-compliance throughout the audit.
Finally, we obtained written representations that all known instances of (suspected) fraud or non-compliance with laws and regulations have been disclosed to us.
Audit approach going concern
We are responsible for obtaining reasonable assurance about the group's ability to continue as a going concern. It is management's responsibility to assess the group's ability to continue as a going concern and to disclose in the financial statements any events or circumstances that may cast reasonable doubt upon the group's ability to continue as a going concern.
As explained on page 134, the accounting policies used in the financial statements are based on the assumption of going concern of the company.
We have reviewed management's assessment of the going concern assumption of Alliander N.V., including the related disclosures in the Alliander N.V. 2021 financial statements. In our analysis, we considered the following:
The 2022-2026 business plan;
The financial position as of December 31, 2021;
The budget for 2022;
The energy transition and resulting financing needs;
Most recent credit ratings from Moody's and S&P.
Based on our work, we have no findings to report.
Paragraph emphasising the impact of the energy transition
As a network company, Alliander faces major required investments and associated financing needs. We draw attention to pages 37-38 and 113 of the Management Report, in which the Management Board described the impact of the energy transition. This energy transition will require substantial investments in the coming years in connection with expansions and reinforcements of the electricity network and the related financing requirements. Alliander is investigating the various options for securing its long-term financing. Our opinion has not changed as a result of this matter.
Our key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements. We have communicated the key audit matters to the supervisory board. The key audit matters are not a comprehensive reflection of all matters discussed.
These matters were addressed in the context of our audit of the financial statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Key audit matters 2021
Key audit matter
Property, plant and equipment
In determining the carrying amount of property, plant and equipment amounting to € 8,501 million as at 31 December 2021, significant assumptions and judgments are applied, both in determining the amounts that should be capitalized and in assessing the useful lives of the assets. Furthermore property, plant and equipment require significant time and resource to audit due to their magnitude.
The disclosures regarding the accounting policies are included on pages 138-139 of the financial statements. Specific disclosures regarding property, plant and equipment are included in notes 3, 26, 37 and 53 of the financial statements.
Our audit procedures on the key audit matter
Our audit approach
Property, plant and equipment are measured at historical cost less accumulated depreciation and impairment losses. These accounting policies are in line with International Financial Reporting Standards (IFRS) as adopted by the EU and have been applied consistently.
Our audit procedures included obtaining an understanding of internal and external developments that are applicable to Alliander specifically or to the sector at large. Based on our risk assessment, where we used data analytics, we determined the audit approach. We performed procedures to test key controls, particularly in relation to cost estimation and subsequent costing, the capitalization of projects, the processing of depreciation, the accounting for project-related hours and IT related controls for the relevant systems. We also performed substantive procedures regarding capitalized costs, divestments and depreciation.
Furthermore we specifically paid attention to the evaluation of the useful live of the gas network. In 2019 the Climate Act was passed and public authorities, businesses and civil society organizations presented the Climate Agreement, which is part of the implementation of the Act. The Climate Agreement states that the Netherlands must abandon natural gas in 2050.
In 2021, the Method Decision regional network operators gas 2022-2026 was published by the Authority Consumer and Market (ACM). In the method decision, the ACM included the results of research conducted into the future of the gas network. The main conclusion is that the use of the gas network will decline in the coming years as a result of the energy transition, but this will not lead to a 'stranded asset' at the end of its useful life. There will still be a partial need for a gas distribution network in 2050. Given the expected decline in gas network use, the ACM has taken measures in the regulatory methodology as a result of which fees should partially be pulled forward. Based on the above, management has concluded that there is no reason to shorten the economic life of the gas networks at this moment, as the regional network operators are still obliged to maintain the gas network.
Based on the materiality described above and the procedures performed by us as described above, we concur with management's assessment regarding capitalized amounts and the economic useful lives of the assets.
The net revenue of Alliander N.V. in 2021 amounts to € 2,120 million and largely relates to the regulated activities of the network operator Liander N.V. The revenue recognition process involves only limited management judgment. Nevertheless the revenue recognition and relevant internal controls and IT systems require significant time and resource to audit due to the magnitude. Therefore revenue recognition was identified as a key audit matter.
The disclosures regarding the accounting policies are included on page 144 of the financial statements. Specific disclosures regarding revenues are included in note 21 of the financial statements.
Our audit approach
Our audit procedures included obtaining an understanding of the significant revenue streams and of relevant internal and external developments. Based on our risk assessment we determined the audit approach. For the material revenue streams, we determined that the accounting policies, which are in line with International Financial Reporting Standards (IFRS) as adopted by the EU, have been applied consistently.
We tested the relevant key controls, particularly for the significant component Liander N.V. These key controls are mainly related to the processing of changes in contracts and rates, and reconciliations, but also to interfaces with external parties (including EDSN) that are used for the exchange of information regarding connections and measurement data relevant to the revenue recognition by Alliander. We also tested the operating effectiveness of IT related controls, to the extent necessary within the scope of the audit of the financial statements, and obtained and reviewed the ISAE 3402 report regarding the internal controls of the service organization EDSN. Finally we performed substantive procedures to test the complete recognition of revenue transactions at the appropriate rates.
Based on the materiality described above and the procedures performed by us as described above, we noted no findings.
Report on the othe information included in the Annual Report
In addition to the financial statements and our auditor's report thereon, the annual report contain other information that consists of:
The Management board’s report (page 3-126).
Based on the following procedures performed, we conclude that the other information:
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.
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 is substantially less than the scope of those performed in our audit of the financial statements.
Management is responsible for the preparation of the other information, including the Management Board's Report in accordance with Part 9 of Book 2 of the Dutch Civil Code, and the other information as required by Part 9 of Book 2 of the Dutch Civil Code.
Report on the other legal and regulatory requirements
We were engaged by the supervisory board as auditor of Alliander N.V. on July 29, 2015, as of the audit for the year 2016 and have operated as statutory auditor ever since that financial year. In December 2019 we were reappointed for the audit of the financial years 2020 and 2021. The Supervisory Board is mandated to this end by the shareholders.
European Single Electronic Reporting Format (ESEF)
Alliander N.V. has prepared its annual report in ESEF. The requirements for this are set out in the Commission Delegated Regulation (EU) 2019/815 with regard to regulatory technical standards on the specification of a single electronic reporting format (hereinafter: the RTS on ESEF).
In our opinion, the annual report, prepared in XHTML format, including the partially marked-up consolidated financial statements, as included in the reporting package by Alliander N.V., complies in all material respects with the RTS on ESEF.
Management is responsible for preparing the annual report including the financial statements in accordance with RTS on ESEF, whereby management combines the various components into a single reporting package.
Our responsibility is to obtain reasonable assurance for our opinion whether the annual report in this reporting package complies with the RTS on ESEF.
Our procedures, taking into account Alert 43 of the NBA (the Netherlands Institute of Chartered Accountants), included amongst others:
obtaining an understanding of the company’s financial reporting process, including the preparation of the reporting package;
obtaining the reporting package and performing validations to determine whether the reporting package containing the Inline XBRL instance and the XBRL extension taxonomy files has been prepared in accordance with the technical specifications as included in the RTS on ESEF;
examining the information related to the consolidated financial statements in the reporting package to determine whether all required mark-ups have been applied and whether these are in accordance with the RTS on ESEF.
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.
Description of responsibilities regarding the financial statements
Responsibilities of management and the supervisory board for the financial statements
Management 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. Furthermore, management is responsible for such internal control as management determines is necessary to enable the preparation of the financial statements that are free from material misstatement, whether due to fraud or error.
As part of the preparation of the financial statements, management is responsible for assessing the company’s ability to continue as a going concern. Based on the financial reporting frameworks mentioned, management should prepare the financial statements using the going concern basis of accounting unless management either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.
Management 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 company's financial reporting process.
Our responsibilities for the audit of the financial statements
Our objective is to plan and perform the audit assignment in a manner that allows us to obtain sufficient and appropriate audit evidence for our opinion.
Our audit has 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.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. The materiality affects the nature, timing and extent of our audit procedures and the evaluation of the effect of identified misstatements on our opinion.
We have exercised professional judgement and have maintained professional skepticism throughout the audit, in accordance with Dutch Standards on Auditing, ethical requirements and independence requirements. Our audit included among others:
Identifying and assessing the risks of material misstatement of the financial statements, whether due to fraud or error, 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 management.
Concluding on the appropriateness of management'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 a 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.
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 audit and significant audit findings, including any significant findings in internal control that we identified during our audit. 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 the key audit matters: those matters that were of most significance in the audit of the financial statements. We describe these matters in our 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.
Amsterdam, 21 februari 2022
Deloitte Accountants B.V.
Assurance report of the independent auditor
To the Management Board of Alliander N.V.
The management board of Alliander N.V. (‘the Company’) engaged us to provide assurance on a selection of non-financial information in the Annual Report 2021 (‘the Report’). Our engagement consisted of a combination of limited assurance (leading to a ‘conclusion’) and reasonable assurance (leading to an ‘opinion’).
We were engaged to provide limited assurance on the following chapters (‘the reviewed information’):
Our story in 2021 (page 3-5).
About this report (page 6-9).
Profile of Alliander (page 10-22).
The value we create, presented in the chapters:
Our network: high supply reliability at a low cost (page 24-35)
A creditworthy company with solid returns (page 36-58)
Making the energy supply and our organisation sustainable (page 59-71)
Ensuring a safe energy network, a safe working environment and a safe data environment (page 72-76)
Being an attractive, inclusive employer with equal opportunities for all (page 77-84)
Our impact on society (page 85-90), including impactcases
Contribution to Global Goals (SDGs) (page 92-96)
Dillemas and lessons learned (page 97-98)
We did not perform review procedures on the information about the EU Taxonomy as disclosed in the chapter ‘EU Taxonomy’ on page 56-57.
Based on our review nothing has come to our attention that causes us to believe that the Report does not present, in all material respects, a reliable and adequate view of:
The policy and business operations with regard to non-financial information.
The thereto related events and achievements for the year 2021.
In accordance with the reporting criteria as included in the section ‘reporting criteria’.
Furthermore we were engaged to provide reasonable assurance on the following information (‘the audited information’):
The summarized materiality assessment presented in the chapter ‘About this report’ (page 8) and the extensive materiality assessment presented in the chapter ‘Other Information, Materiality test’ (page 208-215).
The table "Objectives and results" in the chapter "Profile of Alliander" (page 20-22).
In our opinion, the Report presents, in all material respects, a reliable and adequate view of:
The policy and business operations with regard to non-financial information.
The thereto related events and achievements for the year 2021.
In accordance with the reporting criteria as included in the section ‘reporting criteria’.
Basis for our opinion and our conclusion
We have conducted our review and audit work on the aforementioned information in accordance with Dutch law, including Dutch Standard 3810N ‘Assurance-opdrachten inzake maatschappelijke verslagen’ (Assurance engagements relating to sustainability reports). A review is focused on obtaining limited assurance, while an audit engagement is focused on obtaining reasonable assurance. Our responsibilities under this standard are further described in the section ‘Our responsibilities for the review and audit of the Report’. Furthermore, we have complied with the ‘Verordening gedrags- en beroepsregels accountants’ (VGBA, Dutch code of ethics).
We are independent of Alliander N.V. in accordance with 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 requirements in The Netherlands.
We believe that the audit evidence and assurance evidence we have obtained is sufficient and appropriate to provide a basis for our opinion and conclusion.
The non-financial information in the Report needs to be read and understood together with the reporting criteria. Alliander N.V. 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 Report are the Sustainability Reporting Standards of the Global Reporting Initiative (GRI) and the applied supplemental reporting criteria as disclosed in the chapter “Other Information” of the annual report.
The absence of an established practice on which to draw, to evaluate and measure non-financial information allows for different, but acceptable, measurement techniques and can affect comparability between entities and over time.
Key review matter
Key review matters are those matters that, in our professional judgement, were of most significance in our review of the Report. We have communicated the key review matters to the Supervisory Board. The key review matters are not a comprehensive reflection of all matters discussed.
These matters were addressed in the context of our review of the Report as a whole and in forming our conclusion thereon, and we do not provide a separate conclusion on these matters.
Key review matter
One of the topics on which Alliander N.V. has been reporting since 2016 concerns the societal impact of its activities on the environment as shown in the chapter 'Our impact on society' on page 85-90.
Alliander applied the six capital model of the International Integrated Reporting Council (IIRC) as a basis for determining the relevant societal impacts. Alliander has determined the societal impacts based on the supply chain and has attempted to quantify these impacts in one unity (euros) to the extent possible.
The capitals within the 2021 impact model have remained unchanged compared to last year. However, there has been a methodological change. The addition of an extra attribution type makes it possible to assign primary responsibility to one of the value chain partners, while distributing the rest of the impact across the value chain. In addition, two adjustments are implemented for manufactured capital, whereby the approach is simplified and harmonized across the sector.
As indicated by Alliander the identification, quantification and monetization of societal impacts is still in the early stages of development. Therefore Alliander is obliged to make assumptions. Part hereof is the use of external sources, in which fluctuations outside Alliander’s sphere of influence can occur. As a consequence, positive or negative year-on-year changes can occur.
We note that the monetization of the impact on prosperity and well-being, the balance between social profit and loss and the attribution to the various participants in the energy supply chain, are not yet generally accepted. Therefore the public acceptance of the selected assumptions and calculation methods have been tested only in a limited manner.
A summary of the key assumptions is presented in the ‘Key criteria for measuring impact’ on pages 226-228 of the Report.
Our procedures regarding the key review matter consisted of reviewing the societal impact measurement in the chapter 'Our impact on society on page 85-90.
Based on interviews with employees and management of Alliander N.V. and the external advisors, we obtained an understanding of the methods and assumptions on which the calculations of the social impacts are based.
Where Alliander used expertise of external advisors for the impact calculations (i.e. Trueprice/The Impact Institute), we obtained an understanding of the competency and objectivity of those advisors. Where external sources have been consulted, a reconciliation to those sources has been performed.
We obtained an understanding of the calculations and performed recalculations for the key elements. For the design of the initial model we engaged our model validation expert.
For key assumptions as presented in chapter ‘Key criteria for measuring impact’ on page 226-228 of the Report we performed reconciliations with various sources such as subledgers, external reports and research results.
For prospective information or estimates we obtained an understanding of the underlying data.
Based on the procedures performed, we obtained an adequate understanding of the methods and assumptions used by management.
Based on our work we have no findings to report.
Limitations to the scope of our audit
The Report 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.
Responsibilities of the management board and the supervisory board
The management board is responsible for the preparation of reliable and adequate Report in accordance with the reporting criteria as included in the section ‘reporting criteria’, including the identification of stakeholders and the definition of material matters. The choices made by the management board regarding the scope of the non-financial information and the reporting policy are summarised in chapter ‘Other information’ of the annual report.
Furthermore, the management board is responsible for such internal control as it determines is necessary to enable the preparation of the non-financial information that is free from material misstatement, whether due to fraud or error.
The Supervisory Board is responsible for overseeing the reporting process of the Company.
Our responsibilities for the review and audit of the Report
Our responsibility is to plan and perform the assurance assignment in a manner that allows us to obtain sufficient and appropriate audit evidence for our conclusion and opinion.
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 review is therefore substantially less than the assurance obtained in an audit.
Our audit has been performed with a high, but not absolute, level of assurance, which means we may not have detected all material errors and fraud.
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.
We have exercised professional judgement and have maintained professional scepticism throughout the review and audit, in accordance with the Dutch Standard 3810N, ethical requirements and independence requirements.
Limited assurance procedures
Our review included among others:
Performing an analysis of the external environment and obtaining an understanding of relevant social themes and issues, and the characteristics of the company.
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 management 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 error. Designing and performing further assurance procedures aimed at determining the plausibility of the sustainability information responsive to this risk analysis. These procedures consisted amongst others of:
interviewing relevant staff responsible for the sustainability strategy, policy 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;
obtaining assurance information that the sustainability information reconciles with underlying records of the company;
reviewing, on a limited test basis, relevant internal and external documentation;
performing an analytical review of the data and trends.
Evaluating the presentation, structure and content of the Report.
Considering whether the Report as a whole, including the disclosures, reflects the purpose of the reporting criteria used.
Reasonable assurance procedures
Complementary to the aforementioned procedures, our audit included the following:
Identifying and assessing the risks of material misstatement of the Report, whether due to errors or fraud, 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 errors, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Evaluating the design and implementation and testing the operating effectiveness of the reporting systems and processes related to the information in the Report.
Evaluating internal and external documentation, on a test basis, to determine the reliability of the information in the Report.
We communicate with the supervisory board regarding, among other matters, the planned scope and timing of the review and audit and significant findings, including any significant findings in internal control that we identify during our review and audit.
Amsterdam, 21 februari 2022
Deloitte Accountants B.V.