CONSOLIDATED AND SEPARATE STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
CONSOLIDATED AND SEPARATE STATEMENT OF FINANCIAL POSITION
CONSOLIDATED AND SEPARATE STATEMENT OF CHANGES IN EQUITY
CONSOLIDATED AND SEPARATE STATEMENT OF CASH FLOWS
NOTES TO THE CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS
CONSOLIDATED ANNUAL REPORT
54 - 102
UAB "Deloitte Lietuva"
Jogailos g. 4
Juridinio asmens k.: 111525235
PVM mok. k.: LT115252314
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INDEPENDENT AUDITOR'S REPORT
To the Shareholders of Telia Lietuva, AB:
Report on the Audit of the Financial Statements
We have audited the separate financial statements of Telia Lietuva, AB (the Company) and consolidated financial statements of Telia Lietuva, AB and subsidiaries (the Group), which comprise the statements of financial position of the Company and the Group as at 31 December 2020, and the statements of profit or loss and other comprehensive income, changes in equity and cash flow for the year then ended, and notes to the financial statements, including a summary of significant accounting policies.
In our opinion, the accompanying separate and consolidated financial statements present fairly, in all material respects, of the financial position of the Company and the Group as at 31 December 2020, and their financial performance and cash flows for the year then ended in accordance with the International Financial Reporting Standards as adopted by the European Union.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the International Ethics Standards Board for Accountants' Code of Ethics for Professional Accountants (IESBA Code) together with the requirements of the Law on Audit of Financial Statements of the Republic of Lithuania that are relevant to audit in the Republic of Lithuania, and we have fulfilled our other ethical responsibilities in accordance with the Law on Audit of Financial Statements of the Republic of Lithuania and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
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.
Key Audit Matter
How our audit addressed the Key Audit Matter
Refer to pages 23, 31 of the financial statements
The Group's and the Company's net sales amounted to EUR
Our audit procedures in this area included, among others:
398,083 thousand and EUR 399,041 thousand, respectively
assessing the application on the Company's and the
for the year then ended 2020.
Group's accounting policies with the respect to IFRS 15
The net sales encompass several revenue streams such as
to services and products delivered and the accounting
implication of the new business models to verify that the
traffic charges, including interconnect and roaming,
Group accounting policies were appropriate for these
subscription fees, installation fees, other services and sale of
models and were followed;
equipment. Furthermore, all these services and products give
evaluating the design and implementation as well as
rise to multiple customer offerings (bundle services) which
testing for operating effectiveness key internal controls,
are subject to price allocation among the services and related
including relevant IT systems, used for billing and
products, incentives and discounts.
monitoring of revenue recognition;
The Company and the Group uses multiple billing systems
assessing based on sample of customer bills for
accuracy for new products and tariffs introduced in the
and other interrelated data applications to maintain the
accurate and complete accounting records. IT systems differ
under multiple-element contractual arrangements
across a range of products and lines of business. The
(bundled product offers), on a sample evaluating the
Company and the Group is implementing SAP as the new
deliverables to determine whether they represent
core platform, as well as legacy systems run in parallel to
separate element and testing the value allocated to the
ensure uninterrupted operations. IT environment is thus a
undelivered elements based on their respective fair
critical part in the revenue processes.
Deloitte yra vadinamos Deloitte Touche Tohmatsu Limited (DTTL) ir grupei priklausančios bendrovės narės bei susijusios įmonės (kartu - "Deloitte organization"). Kiekviena DTTL (dar vadinama "Deloitte Global") ir grupei priklausanti bendrovė narė bei susijusi įmonė yra atskiri ir nepriklausomi juridiniai asmenys, kurie vienas kitam negali nustatyti įsipareigojimų trečiųjų šalių atžvilgiu. DTTL ir kiekviena grupei priklausanti bendrovė narė bei susijusi įmonė yra atsakingos tik už savo, o ne už viena kitos veiksmus ar neveikimą. DTTL pati savaime paslaugų klientams neteikia. Daugiau informacijos galite rasti čia
Complex products and services and a combination of those requires significant management judgment about the timing and value of revenue to be recognized and impose the risk of accuracy of revenue related accounting records, as well as recognizing revenue in the correct accounting period. Due to this, we considered this to be a key audit matter.
evaluating on a sample basis revenues allocated to undelivered elements (deferred and recognized over the estimated term of provision of these elements);
reconciling revenue accruals to actual data traffic available after month closing;
evaluating the adequacy of disclosures related to the various revenue streams;
assessing and testing general IT controls for relevant IT systems in the areas of access security (especially privileged access management), system change control, as well as management of data center and network operations.
The other information comprises the information included in the Company's and the Group's annual report, including Corporate Governance statement, Remuneration Report and Corporate Social Responsibility Report, but does not include the financial statements and our auditor's report thereon. Management is responsible for the other information.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon, except as specified below.
In connection with our audit of the financial statements, our responsibility is to read the other information 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. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
In addition, our responsibility is to consider whether information included in the Company's and the Group's annual report, including Corporate Governance statement and Remuneration Report, for the financial year for which the financial statements are prepared is consistent with the financial statements and whether the Company's and the Group's annual report, including Corporate Governance statement and Remuneration Report, has been prepared in compliance with applicable legal requirements. Based on the work carried out in the course of audit of financial statements, in our opinion, in all material respects:
The information given in the Company's and the Group's annual report, including Corporate Governance statement and Remuneration Report, for the financial year for which the financial statements are prepared is consistent with the financial statements; and
The Company's and the Group's annual report, including Corporate Governance statement and Remuneration Report, has been prepared in accordance with the requirements of the Law on Consolidated Financial Reporting by Group Undertakings of the Republic of Lithuania and the Law on Financial Reporting by Undertakings of the Republic of Lithuania.
We also need to check that the Corporate Social Responsibility Report has been provided. If we identify that Corporate Social Responsibility Report has not been provided, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with the International Financial Reporting Standards as adopted by the European Union, and 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.
In preparing the financial statements, management is responsible for assessing the Company's and the Group'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 and the Group or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company's and the Group's financial reporting process.
Auditor's 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 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, we exercise professional judgment and maintain professional scepticism 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 and the Group'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 and the Group'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 and the Group 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.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.
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, related safeguards.
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.
Report on other legal and regulatory requirements
In accordance with the decision made by Shareholders on 28 April 2020 we have been chosen to carry out the audit of the Company's and the Group's separate and consolidated financial statements. Our appointment to carry out the audit of the Company's and the Group's separate and consolidated financial statements in accordance with the decision made by Shareholders has been for year 2020 and the period of total uninterrupted engagement is seven years.
We confirm that our opinion in the section 'Opinion' is consistent with the additional report which we have submitted to the Company and Audit Committee.
We confirm that in light of our knowledge and belief, services provided to the Company and the Group are consistent with the requirements of the law and regulations and do not comprise non-audit services referred to in Article 5(1) of the Regulation (EU) No 537/2014 of the European Parliament and of the Council.
In addition to services provided to the Company in the course of audit and disclosed in the annual report, we performed translation of the financial statements from English into Lithuanian language, as well as performed audit procedures related to the separation of payment service activities from other services and the internal controls applicable to the former activities.
The engagement partner on the audit resulting in this independent auditor's report is Mindaugas Jukna.
Deloitte Lietuva UAB
Audit Company License No 001275
Lithuanian Certified Auditor
License No 000580
Vilnius, Republic of Lithuania
31 March 2021
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