To the Shareholders of INVESTMENT FRIENDS SE
Qualified Opinion
We have audited the financial statements of INVESTMENT FRIENDS SE (the Company),
which comprise the statement of financial position as at June 30, 2023, and the statement of
profit or loss, statement of comprehensive income, statement of cash flows and statement of
changes in equity for the year then ended, and notes to the financial statements, including a
summary of significant accounting policies.
In our opinion, except for the possible effects of the matter described in the Basis for Qualified
Opinion section of our report the accompanying financial statements present fairly, in all
material respects, the financial position of the Company as at June 30, 2023, and its financial
performance and its cash flows for the year then ended in accordance with International
Financial Reporting Standards (IFRS) as adopted by the European Union.
Basis for Qualified Opinion
The Company's statement of financial position as of 30.06.2023 contains loan and interest
receivables against the related company Damar Patro in the amount of 1402 thousand
euros. Damar Patro UÜ's assets mainly consist of funds in investment accounts, which are
recognized at fair value. In the year ended on 30 June 2023, the fair value of Damar Patro
UÜ's investment portfolios has decreased, and the company's liabilities exceed its assets. Due
to the above, we did not get enough certainty whether the balance sheet value of the
receivables might be overvalued and whether and in which extent the receivables require a
writing down.
We conducted our audit in accordance with International Standards on Auditing (Estonia) (ISA
(EE)s). Our responsibilities under those standards are further described in the Auditors
Responsibilities for the Audit of the Financial Statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
We are independent of the Company in accordance with the International Code of Ethics for
Professional Accountants (including International Independence Standards) issued by the
International Ethics Standards Board for Accountants (IESBA Code). We have fulfilled our
other ethical responsibilities in accordance with the IESBA Code.
To the best of our knowledge and belief, we declare that non-audit services that we have
provided to the Company are in accordance with the applicable law and regulations in the
Republic of Estonia and that we have not provided non-audit services that are prohibited under
§ 59
of the Auditors Activities Act of the Republic of Estonia.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the financial statements of the current period. 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. For each matter
below, our description of how our audit addressed the matter is provided in that context.
Key audit matter
How our audit addressed the key audit
Valuation of loan receivables
As disclosed in the Note 4 “Financial
assets” to the financial statements,
financial assets consist of loans and
interests in the amount of 1432 thousand
euros which corresponds to 100% of the
Company’s assets. All of these loans are
loans to the related parties.
The value of these loans is assessed using
the amortized cost method as described in
the Note 1 to the financial statements.
Valuation of receivables is a subjective
area due to the level of judgement applied
by the management, based on
management’s past experience and
Our audit procedures included, amongst
We examined the terms of the loan
agreements and checked the
accounting data compliance with
the agreements.
We checked the balances with the
balance confirmations.
We examined and analyzed the
financial data of the borrowers; we
reviewed whether management’s
judgements are in accordance with
our understanding.
We checked the received payments
of the loans after the post balance
sheet date.
We assessed the adequacy of the
disclosed information and
compliance with IFRS
Other Information, including the Management Report
Management is responsible for the other information. The other information comprises the
Selected Financial Data, the Management Report, the Corporate Governance Report and the
Remuneration Report (but does not include the financial statements and our auditor’s report
thereon). Our opinion on the financial statements does not cover the other information,
including the Management report.
In connection with our audit of the financial statements, our responsibility is to read the other
information identified above and, in doing so, consider whether the other information is
materially inconsistent with the financial statements or our knowledge obtained in the audit, or
otherwise appears to be materially misstated. With respect to the Management report, we also
performed the procedures required by the Auditors Activities Act. Those procedures include
considering whether the Management report is consistent, in all material respects, with the
financial statements and is prepared in accordance with the requirements of the Accounting
As described in the "Basis for Qualified Opinion" section, we did not get sufficient certainty
about possible impairment of receivables in the statement of financial position. We are not able
to make conclusions whether other information has been misrepresented in connection to this
In accordance with the Securities Market Act with respect to the Remuneration Report, our
responsibility is to consider whether the Remuneration Report includes the information in
accordance with the requirements of Article 135
of the Securities Market Act.
Based on the work undertaken in the course of our audit, in our opinion:
● the information given in the Management report for the financial year for which the financial
statements are prepared is consistent, in all material respects, with the financial statements;
the Management report has been prepared in accordance with the requirements of the
Accounting Act;
● the Remuneration Report has been prepared in accordance with Article 135
of the
Securities Market Act.
Responsibilities of Management and Those Charged with Governance for the Financial
Management is responsible for the preparation and fair presentation of the financial statements
in accordance with International Financial Reporting Standards (IFRS) as adopted by the
European Union and for such internal control as management determines is necessary to
enable the preparation of financial statements that are free from material misstatement,
whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the
Company’s ability to continue as a going concern, disclosing, as applicable, matters related to
going concern and 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.
Those charged with governance are responsible for overseeing the Company’s financial
reporting process.
Auditors Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as
a whole are free from material misstatement, whether due to fraud or error, and to issue an
auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance,
but is not a guarantee that an audit conducted in accordance with ISAs (EE) will always detect
a material misstatement when it exists. 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.
As part of an audit in accordance with ISAs (EE), we exercise professional judgment and
maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those
risks, and obtain 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.
Obtain 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.
Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
Conclude 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 the Company to cease to
continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements,
including the disclosures, and whether the financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit and significant audit findings, including any significant
deficiencies in internal control that we identify during our audit.
We also provide those charged with governance 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, actions taken to eliminate threats or safeguards applied.
From the matters communicated with those charged with governance, we determine those
matters that were of most significance in the audit of the financial statements of the current
period and are therefore the key audit matters. 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, we determine that a matter should not be communicated in our
report because the adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.
Appointment and period of our audit engagement
We were first appointed as auditors of Investment Friends SE for the financial year ended 30
June 2020. Our appointment has been renewed by shareholder resolutions, representing the
total period of our uninterrupted engagement appointment for Investment Friends SE of 4
/digitally signed/
Eve Leppik
License No 230
Company: Number RT OÜ
License: 263
Linnu tee 21a, Tallinn 11317
09. October 2023