Financial Statements

Consolidated balance sheet as at december 31, 2018

Before profit appropriation (in € 1,000s)

Assets

Notes

December 31, 2018

December 31, 2017

Fixed assets

Tangible fixed assets

8,766

11,126

Total fixed assets

8,766

11,126

Current assets

Receivables and prepayments

15,967

11,320

Cash

10,062

11,657

Total current assets

26,029

22,977

Total assets

34,795

34,103

Liabilities

Group equity

20,149

19,387

Provisions

495

774

Short-term liabilities

Trade creditors

3,713

3,521

Taxes and social security premiums

2,424

3,080

Corporation tax payable

182

581

Accrued expenses

7,832

6,760

Total short-term liabilities

14,151

13,942

Total liabilities and equity

34,795

34,103

Consolidated profit and loss statement for the year 2018

(in € 1,000s)

Notes

2018

2017

Total operating revenues

68,333

59,254

Operating costs

Services and components

15,469

11,528

Personnel costs

37,194

35,411

Housing costs

2,672

2,511

Other operating costs

5,538

2,596

Depreciation of fixed assets

3,500

3,278

Total operating costs

64,373

55,324

Earnings before interest and tax

3,960

3,930

Balance of interest and similar
revenue and costs

50

-32

Earnings before tax

4,010

3,898

Corporation tax

-760

-698

Net profit

3,250

3,200

Direct equity movements

-88

-

Total result

3,162

3,200

Consolidated cash flow statement for the year 2018

(in € 1,000s)

2018

2017

Earnings before interest and tax

3,960

3,930

Depreciation

3,500

3,278

Change in provisions

-279

-35

Change in working capital

-4,073

-2,263

Cash flow from operations

3,108

4,910

Interest received

50

-28

Corporation taxes paid

-1,125

-472

Cash flow from operating activities

2,033

4,410

Additions to:

Tangible fixed assets

-1,140

-2,567

Disposals of:

Tangible fixed assets

-

304

Cashflow from investing activities

-1,140

-2,263

Dividends paid

-2,400

-4,471

Stak transactions

-88

-

Cash flow from financing activities

-2,488

-4,471

Change in cash

-1,595

-2,324

Cash at January 1

11,657

13,981

Cash at December 31

10,062

11,657

Principles of Valuation of Assets and Liabilities

General

Schuberg Philis Group B.V. is located at the Boeingavenue 271, 1119 PD Schiphol-Rijk and is registered under chamber of commerce number 34181542. It has his statutory seat in Amsterdam. The accounts are prepared in accordance with the accounting principles generally accepted in the Netherlands. The accounts are prepared in Euro.

Applied standards

The financial statements have been prepared in accordance with Book 2 of the Dutch Civil Code. The principles adopted for the valuation of assets and liabilities and determination of the result are based on the historical cost convention.

Going concern

These financial statements have been prepared on the basis of the going concern assumption.

Application of Section 402, Book 2 of the Dutch Civil Code

The financial information of Schuberg Philis Group B.V. is included in the consolidated financial statements. For this reason, in accordance with Section 402, Book 2 of the Dutch Civil Code, the income statement of Schuberg Philis Group B.V. exclusively states the share in the result after taxation of companies in which participating interests are held and the general result after taxation.

Financial instruments

Financial instruments include trade and other receivables, cash items, loans and other financing commitments, and trade and other payables. Initial recognition is at fair value. After initial recognition, financial instruments are valued in the manner described below.

  • Financial instruments held for trading
    Financial instruments (assets and liabilities) held for trading are carried at fair value and changes in the fair value are recognized in the profit and loss account. In the first period of recognition, attributable transaction costs are charged to the profit and loss account.
  • Loans granted and other receivables
    Loans granted and other receivables are carried at amortized cost on the basis of the effective interest method, less impairment losses.
  • Other financial instruments
    Financial commitments that are not held for trading are carried at amortized cost on the basis of the effective interest rate method.

Consolidation

The consolidated financial statements comprise the financial data of Schuberg Philis Group B.V. and Schuberg Philis B.V.. In preparing the consolidated financial statements, intra-group debts, receivables and transactions are eliminated.
Schuberg Philis Group B.V., domiciled in Schiphol-Rijk, is a private limited company. The company is a holding company; the group is primarily involved in IT outsourcing activities.

Foreign currencies

Balance sheet items relating to assets and liabilities denominated in currencies other than the Euro are translated at the rate of exchange prevailing on balance sheet date. Transactions in foreign currency are incorporated in the annual accounts at the rate of settlement.

Accounting policies

Certain comparative amounts have been reclassified to conform to current years’ presentation. Reclassification does not have an impact on equity or result.

If not stated otherwise, assets and liabilities are shown at nominal value.

An asset is recognized in the balance sheet when it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the cost of the asset can be reliably measured. A liability is included in the balance sheet when it is expected to result in an outflow of resources embodying economic benefits and the amount of the obligation can be measured with sufficient reliability.
If a transaction results in a transfer of future economic benefits and when all risks relating to an asset or liability are transferred to a third party, the asset or liability is
no longer recognized in the balance sheet. In addition, assets and liabilities are not recognized in the balance sheet as, from the moment the conditions with respect to the probability of economic benefits, expectations of outflow of resources embodying economic benefits and the ability to measure cost with sufficient reliability are not met anymore.

Tangible fixed assets

Tangible fixed assets are valued at acquisition cost less straight-line depreciation over the estimated useful economic life. The estimated useful life (EUL) of different categories of fixed assets is summarized in the table below.

Category

Years (EUL)

Buildings and constructions

Leasehold improvements

5-20

Machinery and equipment

Emergency power supplies

20

Security and communication equipment

10

Computer equipment

3-5

Other fixed assets

Furniture and fixtures

3-10

Impairment or disposal of fixed assets

The company states intangible, tangible and financial fixed assets in accordance with accounting principles generally accepted for financial reporting in the Netherlands. Pursuant to these principles, assets with long life should be reviewed at each balance sheet date to determine whether there is an indication of impairment. If any such indication exists the assets’ recoverable amount is estimated. The recoverable amount
is the highest of the fair value and the value in use. The value in use is calculated as the present value of estimated future cash flows. If the book value of an asset exceeds the recoverable amount, impairment is charged to the result equal to the difference between the carrying amount and recoverable amount. Assets for sale are stated at the carrying amount or lower market value, less selling costs.

Provisions

Provisions are valued at the nominal value of the best estimate of the amount to settle the obligation at balance sheet date.
A provision is recognized if the following applies:

  1. The company has a legal or constructive obligation, arising from a past event;
    and
  2. The amount can be estimated reliably;
    and
  3. It is probable that an outflow of economic benefits will be required to settle the obligation.

A provision for maintenance is recognized for expected maintenance costs of buildings and equipment based on a long-term maintenance program.
The provision for warranties relates to the estimated costs if delivered services do not meet the agreed requirements. A provision for warranties is recognized when the underlying services are sold. The provision is based on historical warranty data and a weighting of all possible outcomes against their associated probabilities. Other provisions relate to personnel related provisions.

Receivables and prepayments

The accounting policies applied for the valuation of trade and other receivables and securities are described under the heading ‘Financial instruments’.

Current liabilities

The valuation of current liabilities is explained under the heading ‘Financial instruments’.

Employee benefits

Obligations for contributions to defined contribution pension plans are recognized as an expense in the income statement as incurred.

PRINCIPLES OF DETERMINATION OF RESULT

General

The result represents the difference between the value of the services rendered and the costs and other charges for the year. The results on transactions are recognized in the year they are realized; losses are taken as soon as they are foreseeable. Costs are recognized at the historical cost convention and are allocated to the reporting year to which they relate.

Exchange rate differences

Exchange rate differences arising upon the settlement of monetary items are recognized in the profit and loss account in the period that they arise.

Net revenue

The company takes the revenue from sales to the net revenue if there is convincing evidence of a sales agreement, when delivery has taken place, the prices have been agreed or can be determined, and there is reasonable certainty that the selling price is collectable. Revenue from projects is recognized over the duration of the project. Normally, these criteria are satisfied at the moment the product or the service is delivered and acceptance has been obtained, if required. Net revenue is determined as income from the supply of goods and services, less discounts and suchlike, exclusive of turnover taxes.

Net revenue is mainly realized in the Netherlands.

Services and components

Services and components represent the direct expenses attributable to revenue.

Corporation tax

The taxation on result comprises both taxes payable in the short term and deferred taxes, taking account of tax facilities and non-deductible costs. No taxes are deducted from profits if and insofar as said profits can be offset against losses from previous years. 

Taxes are deducted from losses if these can be offset against profits in previous years and this results in a tax rebate. In addition, taxes may be deducted to the extent that it is probable that future taxable profits will be available against which the asset can be utilized. Taxes are calculated on the results, taking into account the tax facilities.

Employee benefits/pensions

Schuberg Philis operates a pension plan for its employees based on a defined contribution scheme. The main principle is that the pension charge recognized for the reporting period is equal to the pension contributions over the period. Insofar as the payable contributions have not yet been paid as at the balance sheet date, a liability is recognized. If the contributions already paid exceed the payable contributions as at balance sheet date, a receivable is recognized to account for any repayment or settlement with contributions payable in the future.

The use of estimates

During the preparation of the financial statements, the management must, in accordance with the general prevailing principles, make certain estimates and assumptions that co- determine the stated amounts. The actual results may deviate from these estimates.

PRINCIPLES OF DETERMINATION OF CASH FLOW STATEMENT

The cash flow statement has been prepared using the indirect method. The cash items disclosed in the cash flow statement comprise cash at banks and in hand. Cash flows denominated in foreign currencies have been translated at average estimated exchange rates. Exchange differences affecting cash items are included in the cash flow statement. Interest paid and received, dividends received and income taxes are included in cash from operating activities. Dividends paid are recognised as cash used in financing activities. Transactions not resulting in inflow or outflow of cash, including finance leases, are not recognised in the cash flow statement. Payments of finance lease instalments qualify as repayments of borrowings under cash used in financing activities and as interest paid under cash generated from operating activities.

Notes to the consolidated financial statements

Tangible fixed assets

(in € 1,000s)

Buildings and

constructions
(Leasehold

improvements)

Machinery and equipment

Other
fixed
assets

Total

Cost

Beginning of year 01-01-2018

20,711

19,843

2,965

43,518

Additions

49

1,047

44

1,140

Disposals

0

0

0

0

End of Year 31-12-2018

20,760

20,890

3,009

44,658

Accumulated Depreciation

Beginning of year 01-01-2018

-15,225

-14,715

-2,452

-32,392

Additions

-1,138

-2,161

-201

-3,500

Disposals

0

0

0

0

End of Year 31-12-2018

-16,363

-16,876

-2,653

-35,892

Book Value

Beginning of year 01-01-2018

5,486

5,128

513

11,126

End of year 31-12-2018

4,397

4,014

356

8,766

Receivables and prepayments

Receivables and prepayments are specified in the following table. As per balance sheet date, all receivables are due within one year. The book value represents maximum credit risk and there are no major concentrations of risk.

Category (in € 1,000s)

December 31, 2018

December 31, 2017

Debtors

11,031

5,863

Receivables from affiliated companies

1,207

26

Deferred tax asset

112

146

Other receivables

3,617

5,285

Total

15,967

11,320

Cash

Included in the cash figure of m€ 10,1 is a restricted amount of k€ 275. The other liquid assets are available on demand.

Group equity

Reference is made to page 102 (Notes to the Corporate Financial Statements 2018) for notes regarding equity.

Provisions

Based on a long-term maintenance program, an asset retirement obligation is recognized for expected maintenance costs of buildings and equipment.

Provisions (in € 1,000s)

December 31, 2018

December 31, 2017

Asset retirement obligation

479

464

Maintenance equipment

16

310

Total

495

774

(in € 1,000s)

Asset retirement obligation

Maintenance equipment

Total

Balance 01-01-2018

464

310

774

Additions

15

37

52

Released

0

-6

-6

Used during the year

0

-325

-325

Balance 31-12-2018

479

16

495

Financial instruments

Within Schuberg Philis Group B.V. and its subsidiary financial instruments include receivables, cash and cash equivalents, and long-term liabilities and short-term liabilities. Financial instruments are recognized initially at fair value, including direct attributable transaction costs. After initial recognition, financial instruments are stated against amortized cost. If there are no premiums or discounts and directly attributable transaction costs, the amortized cost is equal to the nominal value. On receivables, a provision deemed necessary is taken for risk of bad debt.

During the normal course of business, the company uses various financial instruments that expose the company to market and/or credit risks. These relate to financial instruments that are included on the balance sheet. The company does not trade in theses financial derivatives and follows procedures and code of conduct to limit the size of the credit risk with each counterparty and market. If a counterparty fails to meet its payment obligations to the company, the resulting losses are limited to the fair value of the instruments in question. The contract value or principal amounts of the financial instruments serve only as an indication of the extent to which such financial instruments are used, and not of the value of the credit or market risks.

  • Credit risk
    For details about the credit risks on accounts receivable from participating interests and the other receivables, reference is made to the principles of valuation of receivables.
  • Cash flow risk
    Cash flow risk for the company is limited.
  • Interest rate risk
    The company’s policy is not to use derivative financial instruments to control interest rate fluctuations. The foreign exchange risk is limited, as the company has limited volume of foreign currencies.
  • Fair value
    The fair value of most of the financial instruments stated on the balance sheet, including accounts receivable, cash, and current liabilities, is close to the carrying amount.

Accrued expenses

Accrued expenses are specified in the table below. As per balance sheet date, all accrued expenses are due within one year.

Category (in € 1,000s)

December 31, 2018

December 31, 2017

Accrued personnel related expenses

4,342

3,719

Accrued expenses

2,322

2,247

Deferred income

1,158

780

Other accrued expenses

10

14

Total

7,832

6,760

Off balance assets and liabilities

Reference is made to page 102 (Notes to the Corporate Financial Statements 2018) for notes regarding off balance assets and liabilities.

Employees and staff

As per December 31, 2018 approximately 284 people are involved in the Group’s operations, 237 of whom are employed by Schuberg Philis B.V..

During the 2018 financial year, the average number of employees in the group, expressed in full time equivalents, amounted to 228 (2017: 188 employees). All employees were employed in the Netherlands. Personnel costs are specified in the table below.
Based on the exemption in Article 383 Section 1 of Part 9, Book 2 of the Dutch Civil Code, the Directors’ remuneration is not disclosed.

Category (in € 1,000s)

December 31, 2018

December 31, 2017

Salaries

22,522

19,350

Social security costs

2,148

1,704

Pension costs

1,153

974

Other personnel costs

11,371

13,383

Total

37,194

35,411

Corporation tax

The company forms a tax unity for corporation income tax purposes together with the group company Schuberg Philis B.V.. Each of the companies recognizes the portion
of corporation income tax that the relevant company would owe as an independent taxpayer, taking into account the tax facilities applicable to the company. The tax expense recognized in the profit and loss account for 2018 amounts to k€760, or 19% of the result before tax (2017: 17%).

In 2018 Schuberg Philis successfully applied with the tax authorities for the applicability of the fiscal facility Innovatiebox for the period 2017-2019. The effective tax rate without the innovatiebox would be 25% (2017: 25%).

(in € 1,000s)

2018

2017

Corporation taxes P&L charge

760

698

Current taxes

726

695

(Change in) deferred taxes

34

3

Total

760

698

Deferred taxes (in € 1,000s)

Opening balance

146

(198)

Additions

-

(108)

Reductions

(34)

452

Closing balance

112

146

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities and the corresponding tax basis used in the computation of taxable income. Deferred tax assets and liabilities are generally recognized for all temporary differences.

Transactions with related parties

Transaction with related parties occur when a relationship exists between the company, its participating interests and their directors and key management personnel. There were no transactions with related parties that were not at arm’s length.

Corporate Balance sheet as at december 31, 2018

Before profit appropriation (in € 1,000s)

Assets

Notes

December 31, 2018

December 31, 2017

Fixed assets

Financial fixed assets

19,074

18,224

Total fixed assets

19,074

18,224

Current assets

Receivables from affiliated companies

1,142

1,595

Deferred tax asset

112

146

Cash

3

4

Total current assets

1,257

1,745

Total assets

20,331

19,969

Liabilities

Shareholders' equity

Share capital

19

19

Other reserves

16,880

16,168

Result for the year

3,250

3,200

Total shareholders' equity

20,149

19,387

Short-term liabilities

Corporation tax payable

182

582

Total short-term liabilities

182

582

Total liabilities

20,331

19,969

Corporate Profit and Loss Statement for the year 2018

(in € 1,000s)

2018

2017

Result from participations

3,250

3,200

Other results

-

-

Total result

3,250

3,200

Notes to the Corporate Financial Statements 2018

General

The corporate financial statements forms part of the consolidated financial statements 2018 of Schuberg Philis Group B.V.. Insofar as items from the balance sheet and profit and loss statement are not clarified below, reference is made to the notes to the consolidated financial statements. If not stated otherwise, receivables and liabilities are due within one year.

Financial fixed assets

This comprises the 100% investment in the subsidiary Schuberg Philis B.V., Schiphol-Rijk. The movement can be specified as follows

(in € 1,000s)

Balance 01-01-2018

18,224

Dividends paid

-2,400

Result for the year

3,250

Balance 31-12-2018

19,074

Cash

The liquid assets are not restricted.

Shareholders’ equity

With reference to Article 178c Part 1 of the Dutch Civil Code, the authorized capital of Schuberg Philis Group B.V. amounts to € 90,000, divided into 72,000 ordinary shares of € 1 each and 180,000 preferred shares of € 0.10 each. The schedule below explains the movements in equity for the year. 19,400 ordinary shares are issued and paid up. There are no preferred shares issued.

(in € 1,000s)

Share
capital

Other
reserves

Result for
the year

Total

Balance 01-01-2018

19

16,168

3,200

19,387

Appropriation of result

0

3,200

-3,200

0

Dividends paid

0

-2,400

0

-2,400

Result for the year

0

0

3,250

3,250

Other

0

-88

0

-88

Balance 31-12-2018

19

16,880

3,250

20,149

Balance 01-01-2017

19

16,171

4,471

20,661

Appropriation of result

0

4,471

-4,471

0

Dividends paid

0

-4,471

0

-4,471

Result for the year

0

0

3,200

3,200

Other

0

-3

0

-3

Balance 31-12-2017

19

16,168

3,200

19,387

Off balance assets and liabilities

Leases

Schuberg Philis has long-term hardware leases, building leases and other lease contracts totaling k€ 11,947 (2017: k€ 10,607).

Off balance assets and liabilites

(in € 1,000s)

<1 Year

1 - 5 Years

>5 Years

Total

Hardware

408

1,159

0

1,567

Building

1,198

4,592

0

5,790

Other lease

1,566

3,024

0

4,590

Total

3,172

8,775

0

11,947

The following operating lease costs were recognized in the consolidated profit and loss statement:

(in € 1,000s)

Total

Hardware

166

Building

1,217

Other lease

1,744

Total

3,127

All payments are considered minimum lease payments.

Guarantees

At balance sheet date, bank guarantees relating to lease of the building were issued for a total of k€ 275.

Tax group

Schuberg Philis Group B.V. forms a fiscal unity for VAT and corporate tax with its wholly-owned subsidiary Schuberg Philis B.V.. The standard conditions stipulate that each of the companies is liable for the tax payable by all companies belonging to the fiscal unity.

Indefeasible right of use

Schuberg Philis B.V. has been granted an Indefeasible Right of Use (IRU) to 20 selected fiber pairs owned by euNetworks B.V. for a period of 20 years, starting January 14, 2003. At a current market price, the IRUs received are valued at k€ 960 (net value of IRUs granted to Schuberg Philis B.V. is k€ 960).

Potential claim

The situation concerning the potential claim that was mentioned in last year’s Annual Report has been resolved.

Employees and staff

During the 2018 financial year the average number of employees, converted into full time equivalents, amounted to 0 (2017: 0 employees).

Summary of audit fees

Summary of audit fees (in € 1,000s)

2018

2017

Audit fees

32

32

Tax advisory fees

0

0

Total fees

32

32

In accordance with Dutch legislation, article 2:382a of the Dutch Civil Code, the total audit and audit-related fees charged by the auditor Mazars amounted to k€ 32. (2017: k€ 32).

Proposed appropriation of the result for the financial year 2018

The Board of Directors proposes that the result for the financial year 2018 amounting to m€ 3,250 should be transferred to the other reserves. The financial statements do not yet reflect this proposal.

Schiphol-Rijk, March 22, 2019.

On behalf of the Board and the Managing Directors,

Pim Berger

Other Information

Statutory profit appropriation

According to Article 28 of the Articles of Association, the profit shall be at the
disposal of the General Meeting. The company may only make distributions of profit
to the shareholders and other persons entitled to the dividends to the extent that its shareholders’ equity exceeds the paid and called up portion of the capital, together with the reserves which must be maintained pursuant to law.
Dividends shall only be distributed following adoption of the annual accounts which show that the distribution is permitted. The company may make interim dividends insofar as the preceding provisions have complied with. The General Meeting may decide to make interim dividends which consists wholly or partly of dividends in kind. The company shall not receive a dividend on shares for its own account. A demand for payment of a dividend will lapse after five years.

The independent auditors’ report by Mazars Paardekooper Hoffman Accountants N.V. has been included on page 108.

Independent Auditor's Report

To the shareholders of Schuberg Philis Group B.V.

Report on the audit of the financial statements 2018 included in the Annual Report

Our opinion

We have audited the financial statements 2018 of Schuberg Philis Group B.V., based in Amsterdam.

In our opinion the accompanying financial statements give a true and fair view of the financial position of Schuberg Philis Group B.V. 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 financial statements comprise:

  1. the consolidated and company balance sheet as at 31 December 2018;
  2. the consolidated and company profit and loss account for 2018; and
  3. 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 Schuberg Philis Group B.V. in accordance with 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.

Report on the other information included in the Annual Report

In addition to the financial statements and our auditor’s report thereon,
the Annual Report contains other information that consists of:

  • the management board’s report;
  • other information as required by Part 9 of Book 2 of the Dutch Civil Code.

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 management board’s report in accordance with Part 9 of Book 2 of the Dutch Civil Code and other information as required by Part 9 of Book 2 of the Dutch Civil Code.

Description of responsibilities regarding the financial statements

Responsibilities of management for the financial statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with 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 framework 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. Management 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 e.g.:

  • 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; and
  • evaluating whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with management 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 identify during our audit.

Amsterdam, March 22, 2019.

MAZARS ACCOUNTANTS N.V.

drs. R.C.H.M. Horsmans RA RV