BANK OCHRONY ŚRODOWISKA S.A. GROUP WARSZAWA, UL. ŻELAZNA 32 CONSOLIDATED FINANCIAL STATEMENTS FOR THE 2013 FINANCIAL YEAR

Transcription

1 BANK OCHRONY ŚRODOWISKA S.A. GROUP WARSZAWA, UL. ŻELAZNA 32 CONSOLIDATED FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR WITH AUDITOR S OPINION AND AUDIT REPORT

2 TABLE OF CONTENTS AUDITOR S OPINION... 3 REPORT ON THE AUDIT OF THE CONSOLIDATED FINANCIAL STATEMENTS OF BANK OCHRONY ŚRODOWISKA S.A. GROUP FOR THE FINANCIAL YEAR... 5 I. GENERAL INFORMATION Details of the audited Parent Company Information about the consolidated financial statements for the prior financial year 8 3. Details of the authorized entity and the key certified auditor acting on its behalf Availability of data and management s representations...9 II. ECONOMIC AND FINANCIAL POSITION OF THE CAPITAL GROUP III. DETAILED INFORMATION Information about the audited consolidated financial statements Consolidation documentation Completeness and correctness of drawing up notes and explanations and the report on the activities of the Capital Group IV. CLOSING COMMENTS CONSOLIDATED FINANCIAL STATEMENTS OF BANK OCHRONY ŚRODOWISKA S.A. GROUP FOR THE FINANCIAL YEAR 1. Consolidated income statement 2. Consolidated statement of comprehensive income 3. Consolidated statement of financial position 4. Consolidated statements of changes in equity 5. Consolidated statement of cash flows 6. Additional notes to consolidated financial statements REPORT ON THE ACTIVITIES OF BANK OCHRONY ŚRODOWISKA S.A. GROUP FOR THE FINANCIAL YEAR Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. 2

3 AUDITOR S OPINION To the Shareholders and Supervisory Board of Bank Ochrony Środowiska S.A. We have audited the attached consolidated financial statements of Banku Ochrony Środowiska S.A. Group ( Capital Group ), with Bank Ochrony Środowiska S.A. as the Parent Company ( Parent Company, Bank ), with its registered office in Warszawa at Żelazna 32, including consolidated statement of financial position prepared as of 31 December, consolidated income statement and consolidated statement of comprehensive income, consolidated statement of changes in equity, consolidated statement of cash flows for the financial year from 1 January to 31 December and additional notes comprising a summary of significant accounting policies and other explanatory information. Preparation of consolidated financial statements and a report on the activities of the Capital Group in line with the law is the responsibility of the Management Board of the Bank. The Management Board of the Bank and members of its Supervisory Board are obliged to ensure that the consolidated financial statements and the report on the activities of the Capital Group meet the requirements of the Accounting Act of 29 September 1994 (Journal of Laws of, item 330, as amended), hereinafter referred to as the Accounting Act. Our responsibility was to audit and express an opinion on compliance of the consolidated financial statements with the accounting principles (policy) adopted by the Capital Group and whether the financial statements present fairly and clearly, in all material respects, the financial and economic position as well as the financial result of the Capital Group and on the correctness of the underlying accounting records. Our audit of the consolidated financial statements has been planned and performed in accordance with: section 7 of the Accounting Act, national auditing standards, issued by the National Council of Statutory Auditors in Poland. We have planned and performed our audit of the consolidated financial statements in such a way as to obtain reasonable assurance to express an opinion on the financial statements. Our audit included, in particular, verification of the correctness of the accounting principles (policy) and material estimates applied by the Bank and the subsidiaries of the Capital Group verification largely on a test basis of the basis for the amounts and disclosures in the consolidated financial statements, as well as overall evaluation of the consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion. 3

4 In our opinion the audited consolidated financial statements of Bank Ochrony Środowiska S.A. Group in all material respects: present fairly and clearly the information material to evaluate the economic and financial position of the Capital Group as of 31 December as well as its profit or loss in the financial year from 1 January to 31 December, have been prepared in accordance with the International Accounting Standards, International Financial Reporting Standards and related interpretations published as European Commission regulations and in all matters not regulated in the standards in accordance with the provisions of the Accounting Act, secondary legislation to the Act and based on properly kept accounting records, comply with the provisions of law applicable to the Capital Group which affect the contents of the consolidated financial statements. The Report on the activities of the Capital Group for the financial year is complete within the meaning of Article 49.2 of the Accounting Act and the Ordinance of the Minister of Finance of 19 February 2009 on current and periodic information published by issuers of securities and the rules of equal treatment of the information required by the laws of non-member states (Journal of Laws of 2014, item 133, as amended) and consistent with underlying information disclosed in the audited consolidated financial statements. Dorota Snarska-Kuman Key certified auditor conducting the audit No On behalf of Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. entity authorized to audit financial statements entered under number 73 on the list kept by the National Council of Statutory Auditors: Dorota Snarska-Kuman Vice-President of the Management Board of Deloitte Polska Sp. z o.o. which is the General Partner of Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. Warsaw, 17 March 2014 The above audit opinion together with audit report is a translation from the original Polish version. In case of any discrepancies between the Polish and English version, the Polish version shall prevail. 4

5 REPORT ON THE AUDIT OF THE CONSOLIDATED FINANCIAL STATEMENTS OF BANK OCHRONY ŚRODOWISKA S.A. GROUP FOR THE FINANCIAL YEAR I. GENERAL INFORMATION 1. Details of the audited Parent Company The Parent Company of the Capital Group ( Capital Group ) operates under the business name Bank Ochrony Środowiska S.A. ( Bank ). The Bank s registered office is located in Warszawa at Żelazna 32. The Bank operates as a joint stock company. The Bank was recorded in the Commercial Register kept by the District Court for the Capital City of Warsaw in Warsaw, XII Business Division of the National Court Register, based on the decision of 04 June 2001, under KRS number The Bank s tax identification number NIP is: assigned on 11 June The REGON number assigned by the Statistical Office is: The Bank operates based on the provisions of the Code of Commercial Companies and Banking Law. In accordance with the Bank s by-laws articles of association, the scope of its activities includes: accepting term and on demand deposits and keeping their records of transactions; operating other bank accounts, granting loans, granting and confirming bank guarantees as well as opening and confirming letters of credit, issuing banking securities, financial settlements operations, issue of electronic money instrument, granting cash advances, concluding check and B/E transactions, issuing payment cards and processing card operations, trading in receivables, safekeeping of objects and securities as well as providing access to safe deposit boxes, purchase and sale of FX values purchasing, selling and intermediating in trade of receivables and liabilities, performing operations related to the issue of securities, providing agency services in international funds transfers and settlements in international trade, acting as depository bank the purchase or disposal of shares and rights to shares, another legal person shares and participation units in investment funds liabilities incurring associated with the securities issue securities dealing term financial operations performing performing, on terms agreed with the debtor, an exchange of the debt to the debtor s assets acquisition and disposal of property the provision of consulting and advisory services in financial matters, particulary in the field related to environmental protection Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. 5

6 provision of factoring services, collection and transfer of orders to buy or sell financial instruments with the provison that a transaction may only refer to securities issued by the State Treasury, or the Polish National Bank, or other financial instruments and bonds not admitted to organized trading referred to in Art. 39p point 1 of the Act on Toll Motorways and the National Road Fund Act dated 27 October 1994, as well as the execution of such orders on behalf of the principal; brokering services for brokerage houses, provision of insurance brokerage services, conducting the collection services on behalf of the banks and entities with whom the Bank had entered into agreements for the joint financing or the agreements for the activities implementation within the operational programs. In the audited period, the Bank conducted the business activities listed above. As of 31 December, the Bank s share capital amounted to PLN 228,732 thousand and was divided into 22,873,245 ordinary shares with a face value of PLN 10 each. As of 31 December the Bank s shareholders included: Narodowy Fundusz Ochrony Środowiska i Gospodarki Wodnej 56.62% shares, Other shareholders 43.38% shares. There were no changes in the share capital of the Bank during the financial year and after the balance-sheet date. During the audited period, the shareholding structure of the Bank s share capital did not undergo changes, among shareholders possessing at least 5% of the total number of votes at the General Meeting of Shareholders of Bank Ochrony Środowiska S.A. As of 31 December, the Capital Group s equity amounted to PLN 1,480,545 thousand. The Bank s financial year is the calendar year. Composition of the Management Board as of the date of the opinion and till the date of the opinion: Mariusz Klimczak - President of the Board Stanisław Kolasiński - Vice-President, the First Deputy of the President of the Management Board Przemysław Lech Figarski - Vice-President of the Board Adam Zbigniew Grzebieluch - Vice-President of the Board Krzysztof Wojciech Telega - Vice-President of the Board In audited period there were no changes in the composition of the Management Board. Composition of the Bank Ochrony Środowiska S.A. Group as of 31 December : Parent Company Bank Ochrony Środowiska S.A. and subsidiaries: Dom Maklerski Banku Ochrony Środowiska 100% subsidiary S.A. BOŚ Eko Profit S.A. 100% subsidiary, BOS Finance AB 100% subsidiary, BOŚ Nieruchomości sp. z o.o. S.K.A. 100% subsidiary (*), BOŚ Nieruchomości sp. z o.o. 100% subsidiary, BOŚ Invest Management sp. z o.o. (dawniej Invest Management Bank Ochrony Środowiska S.A. S.K.A.) 100% subsidiary (**), Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. 6

7 MS Wind Sp. z o.o. 100% subsidiary (***) associated companies: WODKAN Przedsiębiorstwo Wodociągów i Kanalizacji S.A. Associated company, in which Bank has 29.48% in capital shares (*)100% subsidiary, of which the Bank owns directly % and the other 0.002% indirectly via the entity BOŚ Nieruchomości sp. z o.o. (**)100% subsidiary, of which the Bank owns directly 99,52% and the other 0.48% indirectly via the entity BOŚ Eko Profit S.A. (***)100% subsidiary, of which the Bank owns indirectly 100% via the entity BOŚ Eko Profit S.A. The consolidated financial statements as of 31 December included the following entities: a) Parent Company Bank Ochrony Środowiska S.A. We have audited the financial statements of Bank Ochrony Środowiska S.A., the Parent Company, for the period from 1 January to 31 December. As a result of our audit, on 26 February 2014 we issued an unqualified opinion. b) Companies subject to full consolidation: Name and address of the Company Dom Maklerski Banku Ochrony Środowiska S.A. Interest in the capital (%) Name of entity that audited the financial statements and type of opinion issued Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp.k. Balance sheet date of the consolidated entity 31 December Opinion date Ongoing audit BOS Finance AB BOŚ Invest Management sp. z o.o. (dawniej Invest Management Bank Ochrony Środowiska S.A. S.K.A.) BOŚ Eko Profit S.A BOŚ Nieruchomości sp. z o.o. BOŚ Nieruchomości sp. z o.o. S.K.A. MS Wind sp. z o.o. Spółka zależna BOŚ Eko Profit S.A Deloitte AB Szwecja Bez zastrzeżeń Grzegorz Warzocha Partner Biegły Rewident Avanta Audit Sp. z o.o. Sp. k. Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp.k. Grzegorz Warzocha Partner Biegły Rewident Avanta Audit Sp. z o.o. Sp. k. Grzegorz Warzocha Partner Biegły Rewident Avanta Audit Sp. z o.o. Sp. k. Brak obowiązku badania sprawozdania finansowego 31 December 31 December 31 December 31 December 31 October 31 December 28 February February 2014 Ongoing audit 28 February February 2014 Not applicable c) Companies subject to equity method of consolidation: Name and address of the Company WODKAN Przedsiębiorstwo Wodociągów i Kanalizacji S.A. Interest in the capital (%) 29.48% Name of entity that audited the financial statements and type of opinion issued Continuum Consulting Group Poland Sp. z o.o. Balance sheet date of the consolidated entity 31 December Opinion date Ongoing audit The Bank as a Parent Company preparing the consolidated financial statements did not simplify or alter consolidation principles in relation to the consolidated entities. Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. 7

8 In the audited financial year, the Parent Company included in consolidation the following entities: BOŚ Nieruchomości sp. z o.o., BOŚ Nieruchomości sp. z o.o. S.K.A., MS Wind sp. z o.o. 2. Information about the consolidated financial statements for the prior financial year The activities of the Capital Group in 2012 resulted in a net profit of PLN thousand. The consolidated financial statements of the Capital Group for 2012 were audited by a certified auditor. The audit was performed by authorized entity Ernst & Young Audit sp. z o.o. On 13 March the certified auditor issued an unqualified opinion on those financial statements. The General Shareholders Meeting which approved the consolidated financial statements for the 2012 financial year was held on 20 June. In accordance with applicable laws, the consolidated financial statements for the 2012 consolidated financial year were submitted to the National Court Register (KRS) on 26 June. Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. 8

9 3. Details of the authorized entity and the key certified auditor acting on its behalf The audit of the consolidated financial statements was performed based on the agreement of 10 June concluded between Bank Ochrony Środowiska S.A. and Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. with its registered office in Warsaw, al. Jana Pawła II 19, recorded under number 73 on the list of entities authorized to provide audit services kept by the National Council of Statutory Auditors. On behalf of the authorized entity, the audit of the consolidated financial statements was conducted under the supervision of Dorota Snarska-Kuman key certified auditor (No. 9667) in the registered office of the Bank, in its branches and outside the Bank s premises from 2 December to 20 December and from 14 February 2014 until the date of this opinion. The entity authorized to audit the financial statements was appointed by the resolution of the Supervisory Board of Bank Ochrony Środowiska S.A. from 22 May based on authorization included in Article article 20 point 9 paragraph 14 of the Bank's articles of association. Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. and Dorota Snarska-Kuman, key certified auditor, confirm that they are authorized to carry out audits and meet the requirements of Article 56 of the Act on statutory auditors and their self-governing body, auditing firms and on public oversight (Journal of Laws of 2009, No. 77, item 649, as amended) to express an unbiased and independent opinion on the consolidated financial statements of Bank Ochrony Środowiska S.A. Group. 4. Availability of data and management s representations The scope of our audit was not limited. During the audit, all necessary documents and data as well as detailed information and explanations, were provided to the authorized entity and the key certified auditor, as confirmed e.g. in the written representation of the Management Board of the Bank of 17 March Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. 9

10 II. ECONOMIC AND FINANCIAL POSITION OF THE CAPITAL GROUP Presented below are the main items from the consolidated income statement, consolidated statement of comprehensive income consolidated statement of financial position, as well as financial ratios describing the financial performance of the Capital Group and its economic and financial position compared to the prior year calculated based on financial data included in the consolidated financial statements for the financial year. Main items from the statement of financial position (PLN 000) (*) Total assets 18,417,105 16,866,539 Cash and balances with the Central Bank 892,566 1,049,542 Deposits with other banks, loans and advances to other banks 152, ,901 Derivative financial instruments 129,590 88,093 Loans and advances to customers 12,054,541 11,122,492 Investment securities 4,670,032 3,937,399 Intangible assets Property, plant and equipment 116, ,698 Other assets 135, ,193 Amounts due to other banks 443, ,528 Derivative financial instruments 85,401 69,198 Amounts due to customers 13,196, ,320 Debt securities issued 2,733, ,519 Subordinated debt 327, ,714 Other liabilities 122, ,334 Equity 1,480,545 1,441,859 Share capital 228, ,732 Main items from the income statement and statement of comprehensive income (PLN 000) 2012 (*) Net interest income 277, ,520 Net fee and commission income 109, ,589 Net trading income 68,360 32,040 Result on investment securities 20,020 27,071 Net impairment gains/ losses -60,193-52,313 Administrative expenses -365, ,619 Net profit 65,903 33,841 Total comprehensive income 38,460 68,654 Effectiveness ratios (*) Return on equity ratio 4.51% 2.61% Return on assets ratio 0.37% 0.21% Cost to income ratio 73.07% 80.50% Capital adequacy ratio 13.29% 15.19% Equity ratio 8.04% 8.55% (*) restated data according to information disclosed in the consolidated financial statements Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. 10

11 An analysis of the above figures and ratios indicated the following trends in : return on equity ratio (ROE) calculated as a relation of profit for the period to equity calculated as an average of balances as of the end of two last annual periods increased at 31 December, reaching 4.51% in comparison to 2.61% at 31 December 2012, return on asset ratio (ROA) calculated as a relation of profit for the period to total assets calculated as an average of balances as of the end of two last annual periods increased at 31 December, reaching 0.37% in comparison to 0.21% 31 December of 2012, cost to income ratio calculated as a relation of administrative expenses to income calculated as sum of net interest income, net fee and commission income, dividend income, net trading income, foreign exchange result, result on investment securities, result on hedge accounting and and other operating income and expenses decreased in, reaching 73.07% in comparison to 80.50% in 2012, capital adequacy ratio calculated based on resolution No. 76/2010 of the Polish Financial Supervision Authority as at the end of amounted to13.29%. As at 31 December 2012 capital adequacy ratio amounted to 15.19%, equity ratio calculated as a relation of share equity to share equity and liabilities decreased at 31 December, reaching 8.04% in comparison to 8.55% at 31 December of 2012, Application of prudence principles During our audit we have not identified significant discrepancies indicating lack of application of prudence principles determined by Polish Law, resolutions of Management of National Bank of Poland and resolutions of Polish Financial Supervision Authority. Capital adequacy ratio During our audit we have not identified significant discrepancies in the area of calculation of capital adequacy ratio as at 31 December in accordance with resolution No. 76/2010 of the Polish Financial Supervision Authority of 10 March 2010 on the scope and detailed principles for determining capital requirements for particular risks (KNF Journal as of 9 April 2010 with further amendments). Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. 11

12 III. DETAILED INFORMATION 1. Information about the audited consolidated financial statements The audited consolidated financial statements were prepared as of 31 December and include: consolidated income statement for the period from 1 January to 31 December, with a net profit of PLN 65,903 thousand, consolidated statement of comprehensive income for the period from 1 January to 31 December, with a total comprehensive income of PLN 38,460 thousand, consolidated statement of financial position prepared as of 31 December, with total assets and liabilities plus equity of PLN 18,417,105 thousand, consolidated statement of changes in equity for the period from 1 January to 31 December, disclosing an increase in equity of PLN 38,686 thousand, consolidated statement of cash flows for the period from 1 January to 31 December, showing a cash inflow of PLN 440,809 thousand, additional notes, comprising a summary of significant accounting policies and other explanatory information. The structure of assets and liabilities plus equity as well as items affecting the financial profit or loss has been presented in the consolidated financial statements. The audit covered the period from 1 January to 31 December and focused mainly on: verification of the correctness and fairness of the consolidated financial statements prepared by the Management Board of the Bank, verification of the consolidation documentation, evaluation of the correctness of the consolidation methods and procedures applied during consolidation, review of opinions and reports on audits of financial statements of subsidiaries and associated companies included in consolidation, prepared by other certified auditors. 2. Consolidation documentation The Bank presented the consolidation documentation including: 1) financial statements of entities, included in the consolidated financial statements, 2) consolidation packages of controlled entities included in the consolidated financial statements, adjusted to International Accounting Standards, International Financial Reporting Standards and related with them interpretations issued in the form regulations by European Commission ( IFRS ) and the accounting principles (policy) applied during consolidation, 3) all consolidation adjustments and eliminations necessary for preparation of the consolidated financial statements, 4) calculation of the fair value of the net assets of controlled entities, 5) calculation of goodwill and negative goodwill as well as their write-downs, also due to impairment, 6) calculation of non-controlling interests, 7) calculation of exchange differences arising from translation of the financial statements of controlled entities denominated in foreign currencies. Basis for the preparation of the consolidated financial statements Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. 12

13 The consolidated financial statements of the Capital Group for the financial year have been prepared in accordance with the IFRS. Entities in the Capital Group The scope and method of consolidation as well as the relationship between entities in the capital group have been determined based on the criteria specified in IFRS. Financial period The consolidated financial statements have been prepared as of the same end of the reporting period and for the same financial year as the financial statements of the Parent Company Bank Ochrony Środkowiska S.A. Subsidiaries and associated companies included in consolidation prepared their consolidation packages as of the same end of the reporting period as the Bank. Consolidation method The financial statements of the subsidiaries were consolidated using the full method, i.e. full amounts of all relevant items of the financial statements of the Bank and the subsidiaries included in consolidation were summed up. Once the values had been summed up, consolidation adjustments and eliminations were applied to: the cost of shares held by the Bank in subsidiaries and the part of net assets of subsidiaries corresponding to the interest of the Bank in these companies, mutual receivables and liabilities of entities included in consolidation, material revenue and expenses related to transactions between entities included in consolidation. The equity method was applied with respect to associated entities. The value of the Bank s interest in the associated company was adjusted by impairment write offs. 3. Completeness and correctness of drawing up notes and explanations and the report on the activities of the Capital Group The Bank confirmed the validity of the going concern basis in preparation of the consolidated financial statements. The notes to the consolidated financial statements give a correct and complete description of significant measurement principles regarding assets, liabilities plus equity, profit or loss and principles of preparation of the consolidated financial statements. The Bank prepared notes in the form of tables to individual items of the consolidated statement of financial position and statement of comprehensive income as well as narrative descriptions, in line with the requirement of IFRS. Notes describing property, plant and equipment, intangible assets, investments, liabilities and provisions present increases and decreases as well as their basis during the financial year. Limitations imposed on individual assets disclosed in the consolidated statement of financial position arising from security granted to creditors have been described. Individual assets and liabilities plus equity as well as revenue and expenses have been correctly presented by the Bank in the consolidated financial statements. The consolidated statement of financial position, consolidated income statement, consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows as well as notes which constitute an integral part of the consolidated financial statements include all items required for disclosure in the consolidated financial statements under IFRS. Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. 13

14 The Management Board prepared and supplemented the consolidated financial statements with a report on the activities of the Capital Group in the financial year. The report contains all information required under Article 49.2 of the Accounting Act and the Ordinance of the Minister of Finance Ordinance of 19 February 2009 on current and periodic information published by issuers of securities and the rules of equal treatment of the information required by the laws of non- -member states (Journal of Laws of 2014, item 133). We have audited the report with respect to the disclosed information derived directly from the audited consolidated financial statements. IV. CLOSING COMMENTS Management Board s Representation Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. and the key certified auditor received a representation letter from the Bank s Management Board, in which the Board stated that the Capital Group complied with the laws in force. Dorota Snarska -Kuman Key certified auditor conducting the audit No On behalf of Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. entity authorized to audit financial statements entered under number 73 on the list kept by the National Council of Statutory Auditors: Dorota Snarska-Kuman Vice-President of the Management Board of Deloitte Polska Sp. z o.o. which is the General Partner of Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. Warsaw, 17 March 2014 Deloitte Polska Spółka z ograniczoną odpowiedzialnością Sp. k. 14