DataWalkSSF_2023-12-31

An independent member of UHY international

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DATA WALK CAPITAL GROUP. ECA S.A.

INDEPENDENT STATUTORY AUDITOR’S REPORT

ON THE AUDIT OF THE ANNUAL CONSOLIDATED

FINANCIAL STATEMENTS AS OF 31 DECEMBER 2023

(UNAUTHORISED TRANSLATION FROM THE POLISH LANGUAGE)

10/4/2024

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INDEPENDENT STATUTORY

AUDITOR’S REPORT

For the General Meeting and Supervisory Board of DataWalk S.A.

Report on the audit on the annual consolidated financial statements

Opinion

We have audited the annual consolidated financial statements of DATAWALK Capital Group

(the ‘Group’), in which the parent company is DataWalk S.A. (the ‘Parent Company’) which

comprise the consolidated statement of financial position as at December, 31 2023 and the

consolidated statement of comprehensive income, consolidated statement of changes in

equity and consolidated statement of cash flows for the year then ended, and notes to the

consolidated financial statement, including a summary of significant accounting policies

(the ‘consolidated financial statement’).

In our opinion, the accompanying consolidated financial statements:

 give a true and fair view of the consolidated financial position of the Group as at

December 31, 2023 and its consolidated financial performance and its consolidated

cash flows for the financial year then ended in accordance with required applicable

rules of International Financial Reporting Standards approved by the European

Union (IFRSs) and applied accounting principles (policy).

 are in respect of the form and content in accordance with legal regulations

governing the Group and the Parent Company’s Statute.

This opinion is consistent with the additional report to the Audit Committee issued on 10

April 2024.

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Basis for opinion

We conducted our audit in accordance with the National Auditing Standards in the wording

of the International Auditing Standards adopted by Resolution of the National Council of

Statutory Auditors No. 3430/52a/2019 of 21 March 2019 on national auditing standards and

other documents, as amended and the resolution of the Council of the Polish Agency for

Audit Oversight No. 38/I/2022 of 15 November 2022 on national quality control standards,

and the National Auditing Standard 220 (amended) (“NAS”), and also pursuant to the Act of

11 May 2017 on Statutory Auditors, Audit Firms and Public Oversight (“Act on Statutory

Auditors” - cons. text Dz. U. of 2023, item 1015, as amended) and EU Regulation No.

537/2014 of 16 April 2014 on specific requirements regarding statutory audit of public-

interest entities and repealing Commission Decision 2005/909/EC (“ EU Regulation” – OJ

EU L158 of 27 May 2014, p. 77, as amended). Our responsibilities under these standards are

further described in the section of our report Responsibility of the statutory auditor for the

audit of the consolidated financial statement.

We are independent of the Group companies in accordance with the International Ethics

Standards Board for Accountants (including International Standards of Independence) of

the Code of Ethics for Professional Accountants (the ‘IESBA Code”) adopted by resolution of

the National Council of Statutory Auditors No. 3431/52a/2019 of March 25, 2019 on the

principles of professional ethics of statutory auditors as amended, and with other ethical

requirements that are relevant to our audit of financial statements in Poland. We have

fulfilled our other ethical responsibilities in accordance with these requirements and the

IESBA Code. While conducting the audit, the key certified auditor and the audit firm

remained independent of the Group in accordance with the independence requirements

set out in the Act on Statutory Auditors and in the EU Regulation.

We believe that the audit evidence we have obtained is sufficient and appropriate to

provide a basis for our audit opinion.

Explanation with a comment - significant uncertainty regarding going concern

We hereby draw your attention to information included in the consolidated financial

statement regarding explanatory notes “Basis for the preparation of the financial

statements – including a description of circumstances indicating a threat to the going

concern”.

The Management Board identified relevant events and circumstances that may cast serious

doubts in terms of the Group’s ability to continue its activities, including declining sales

revenues, negative cash flow on operations, and unfavourable profitability ratios. The

Management Board took actions aimed at improving the results and liquidity through

introducing a cost reduction scheme, optimizing workforce numbers and structures, and the

number of Group affiliates, increasing deployment team effectiveness, and adapting the

commercial portfolio to customer needs.

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The Management Board reported that continuing development work associated with the

planned release of further, more technologically advanced Group product versions at the

current stage of Group development depends on third-party funding. The Management

Board accepts that without additional funding, the Group may have limited resources for

further investments, which may lead to delays in product development and continued

expansion of the commercial portfolio.

The Management Board provides for a possibility to exercise the right to authorize Group’s

share capital increase or finance its investment activities via alternative capital instruments

and/or financial support schemes funded by the European Union or domestically, which

could effectively help in financing the Group’s activities.

We believe that the possibility of implementing the adopted assumptions is uncertain;

although, it cannot be ruled out that due to unforeseen costs or unforeseen reduction in

the rate of acquiring customers and revenues, increasing the demand for funding in each

case, the Group’s financial standing will significantly deviate from the assumptions, which

may adversely impact the Group’s operations, growth prospects, financial standing or

results.

Our opinion does not include any modification in this regard.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most

significance in our audit of the consolidated financial statements of the current period.

These include the most significant assessed risks of material misstatement, including

assessed risks of material misstatement due to fraud. These matters were addressed in the

context of our audit of the consolidated financial statements as a whole, and in forming our

opinion thereon and have summarised our reaction to these risks and in cases where we

deemed it necessary, we presented the most important observations related to these types

of risks. We do not provide a separate opinion on these matters.

Key Audit Matters How the matter was addressed in our audit

R&D work

In the consolidated financial statements,

the Group recognises costs of completed

development work of TPLN 15,538 and

costs of development work in progress of

TPLN 3,574 representing a total of 36,6% of

the balance sheet total as at 31.12.2023.

Our procedures for the identified key issues of

the audit included, but were not limited to:

 understanding and assessing the

process for identifying, accepting and

classifying development expenditure as

an intangible asset,

 verification of the Group's accounting

policy compliance with IAS 38,

 detailed assurance testing of the

correct allocation of development

expenditure,

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Details of the capitalisation of

development expenditures and

development expenditures in progress

(including information on the results of the

impairment test performed) are described

in Notes 2.1, 2.2, 2.3, 2.4 to the

consolidated financial statements, and

with regard to accounting policy are

described in the notes to the consolidated

financial statements.

The issue was considered to be a key audit

matter due to the scale of the work carried

out, its impact on the Group's operations

and the materiality of the amounts

involved, as well as the fact that the

manner in which they are recognised in the

consolidated financial statements requires

significant management judgement.

 assessment of the prepared

impairment test in terms of

mathematical correctness,

reasonableness of the key parameters

adopted by the Group, compliance of

the financial projections with the

approved financial plan and sensitivity

of the test to a change in the assumed

level of cash flows and the discount

rate,

 discussion with the Parent Company's

Management Board and other

authorised persons of the key

assumptions included in the

impairment test,

 analysis of the disclosures included in

the consolidated financial statements

in relation to completed development

work and development expenditure in

progress.

Sales revenue

The procedures we carried out at the stage

of getting to know the Group and the

analysis of the data resulted in us assigning

risks to the recognition and recognition of

sales revenue.

The risk of incorrect revenue recognition

may arise in particular from fraudulent

recognition of revenue from the sale of

products and services in the wrong period.

Disclosures regarding details of revenue

items are presented in Notes 24.1, 24.2,

24.3 and 24.4 to the consolidated financial

statements, and regarding accounting

policies are described in the notes to the

consolidated financial statements.

The issue was considered to be a key audit

matter due to the materiality of the

amounts and the fact that the manner in

which revenue is recognised and

recognised in the consolidated financial

statements requires significant estimates

and management judgement.

Our procedures for addressing the key risks

identified included:

 reviewing the accounting policies in the

revenue recognition section and

assessing the compliance of these

policies with IFRS 15,

 understanding of the sales process and

the correctness of the design and

implementation of the internal control

system in this area,

 analytical procedures consisting in

particular of the analysis of monthly

data and trends,

 detailed plausibility checks on sales

recognised during the year based on a

selected sample,

 verification of a sample of transactions

from December 2023/January 2024

and independent assessment of the

correctness of revenue recognition to

the source documents for the

transactions,

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 confirmation of receivables balances

on a selected sample of counterparties

as at the balance sheet date,

 analysis of unusual transactions and

revenue adjustments made after the

balance sheet date

The conducted reliability tests, combined with

assessing the internal control environment,

provided us with sufficient and appropriate

audit evidence, required to address the revenue

recognition risk in question.

Responsibility of the Parent Company’s Management and members Supervisory Board for

the consolidated financial statements

The Parent Company’s Management is responsible for the preparation the consolidated

financial statements that give a true and fair view of the consolidated financial position and

the consolidated financial performance in accordance with required applicable rules of

International Financial Reporting Standards approved by the European Union, the adopted

accounting policies, other applicable laws, as well as the Parent Company’s Statute, and is

also responsible for such internal control as determined is necessary to enable the

preparation of the consolidated financial statements that are free from material

misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, the Parent Company's Management is

responsible for assessing the Group's (the Parent Company and significant components)

ability to continue as a going concern, disclosing, as applicable, matters related to going

concern and using the going concern basis of accounting, unless Parent Company's

Management either intends to liquidate the Group (the Parent Company and significant

components) or to cease operations, or has no realistic alternative but to do so.

The Parent Company’s Management and members of the Parent Company’s Supervisory

Board are required to ensure that the consolidated financial statements meets the

requirements of the Accounting Act. The members of the Parent Company’s Supervisory

Board are responsible for overseeing the Group's financial reporting process.

Auditor’s responsibility for audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial

statements s 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 NAS

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 consolidated financial statements.

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The scope of the audit does not include assurance as to the future profitability of the Group

nor effectiveness of conducting business matters now and in the future by the Parent

Company’s Management.

As part of an audit in accordance with NAS, we exercise professional judgment and maintain

professional scepticism throughout the audit and we also:



identify and assess the risks of material misstatement of the consolidated 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

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 Group’s internal control,



evaluate the appropriateness of accounting policies used and the reasonableness

of accounting estimates and related disclosures made by the Parent Company’s

Management,



conclude on the appropriateness of the Parent Company’s 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 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 independent auditor’s report to the related disclosures in the consolidated

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

independent auditor’s report, however, future events or conditions may cause the

Group to cease to continue as a going concern,



evaluate the overall presentation, structure and content of the consolidated

financial statements, including the disclosures, and whether the consolidated

financial statements represent the underlying transactions and events in a manner

that achieves fair presentation



we obtain sufficient appropriate audit evidence regarding the financial information

of entities and business activities within the Group for the purpose of expressing

an opinion on the consolidated financial statements. We are solely responsible for

the direction, supervision and performance of the audit of the Group and we

remain solely responsible for our audit opinion.

We communicate with the Audit Committee of the Parent Company 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.

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We also provide to the Audit Committee of the Parent Company with a statement that we

have complied with relevant ethical requirements regarding independence, and

communicate to 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 to the Audit Committee, we determine those matters that

were of most significance in the audit of the consolidated 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.

Other information, including Group Activity Report

The Other information comprise Group Activity Report as at December 31, 2023 (the “Group

Activity Report”) together with the representation on the corporate governance, which is

separate elements of this Report, and the Annual Report for the financial year ended

December 31, 2023 (“Annual Report”) (together with “Other Information”).

Responsibility of the Parent Company’s Management and Supervisory Board

The Parent Company’s Management is responsible for preparing the Other Information in

accordance with the law.

The Parent Company’s Management and members of the Parent Company’s Supervisory

Board are required are required to ensure that the Group Activity Report along with

separate elements meets the requirements of the Accounting Act.

Auditor's responsibility

Our audit opinion on the consolidated financial statements does not include the Other

Information. In connection with the audit of the consolidated financial statements, our

responsibility is to read the Other Information and, in doing so, to consider whether the

Other Information is materially inconsistent with the consolidated financial statements or

our knowledge obtained during the audit or otherwise appears materially misstated. If,

based on the work we have performed, we conclude that there is a material misstatement

in this Other Information, we are required to report that fact in independent auditor’s

report. Our responsibility in accordance with the Act on Statutory Auditors is also to issue

an opinion on whether the Other Information was prepared in accordance with relevant

laws and that it is consistent with the information contained in the consolidated financial

statements. Moreover, we are required to issue an opinion on whether the Group has

included the required information in the representation on application of corporate

governance.

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We obtained the Other Information before the date of this audit report and the Annual

Report will be available after that date. In the event that we identify a material

misstatement in the Annual Report, we are required to inform the Parent Company's

Supervisory Board.

Opinion on the Group Activity Report

Based on the work performed during our audit, in our opinion, the Group Activity Report:

 has been prepared in accordance with Article 49 of the Accounting Act and section

70 of the Decree of the Minister of Finance of March 29, 2018 on current and

periodic information published by issuers of securities and conditions for

recognising as equivalent information required by the laws of non-EU member state

(‘Decree on current and periodic information’ – Journal of Laws of 2018, item 757

as amended);

 is consistent with the information contained in the consolidated financial

statement.

Moreover, based on our knowledge of the Group and its environment obtained during our

audit, we have not identified material misstatements in the in the Group Activity Report.

Opinion on the corporate governance representation

In our opinion, the representation on application of corporate governance, the Group has

included stipulated in paragraph 70, section 6, point 5 of the Decree on current and periodic

information. Furthermore, in our opinion, the information stipulated in paragraph 70,

section 6, point 5 letter c-f, h and i of the Decree included in the representation on

application of corporate governance is in accordance with applicable laws and information

included in the consolidated financial statements.

Report on other legal and regulatory requirements

Opinion on the compliance of the consolidated financial statements prepared in the single

electronic reporting format with the requirements of the regulation on technical standards

on the specification of a single electronic reporting format.

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As part of our audit of the consolidated financial statement, we were engaged to perform

an assurance engagement to obtain reasonable assurance in order to express an opinion on

whether the consolidated financial statements of the Group for the year ended December

31, 2023 prepared in the single electronic reporting format including in the file named

[DAT_2023-12-31_pl] (“consolidated financial statements in ESEF format”), was tagged in

accordance with the regulations specified in Commission Delegated Regulation (EU) No

2019/815 of December 17, 2018 supplementing Directive 2004/109/EC of the European

Parliament and of the Council with regard to regulatory technical standards on the

specifications of a single electronic reporting format ( Official Journal of the European Union

UE L 143 z 29.05.2019, p. 1, as amended) (the “ESEF Regulation”).

Identification of criteria and description of the object of the service

The consolidated Financial Statement in ESEF format were prepared by the Management

Board of Parent Company in order to meet the tagging and technical requirements of the

single electronic reporting format which are specified in the ESEF Regulation.

The subject matter of our assurance engagement is the compliance verification of the

consolidated financial statements in ESEF format against the requirements of the ESEF

Regulations, while the requirements specified in these regulations represent, in our opinion,

applicable criteria for us to express an opinion providing reasonable assurance.

Responsibility of the Parent Company’s Management and Supervisory Board

The Parent Company’s Management is responsible for preparing of the consolidated

financial statements in ESEF format in accordance with the tagging and technical

requirements of a single electronic reporting format which are specified in the ESEF

Regulation. Such responsibility includes the selection and application of appropriate XBRL

tags using the taxonomy specified in these regulations.

Responsibility of the Parent company’s Management also includes designing, implementing

and maintaining of such internal control as determined is necessary to enable the

preparation of the consolidated financial statements in ESEF format, free from material non-

compliance with the requirements of the ESEF Regulation.

The members of the Parent Company’s Supervisory Board are responsible for overseeing

the financial reporting process, which includes the preparation of financial statements in

compliance with the form in accordance with the governing legal regulations.

Auditor’s responsibility

Our objective was to express an opinion, based on the performed assurance engagement,

providing reasonable assurance, that the consolidated financial statements in ESEF format

was tagged in accordance with the ESEF requirements.

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We have performed our assurance engagement in accordance with the National Standard

for Assurance Engagements Other than Audit and Review 3001PL - “Audit of Financial

Statements Prepared in Single Electronic Reporting Format” adopted by resolution of the

National Council of Statutory Auditors No. 1975/32a/2021 dated December 17, 2021

(hereinafter: “NSAE 3001PL”) and, where applicable, in accordance with the National

Standard on Assurance Engagements Other than Audit and Review 3000 (R) as set out in

International Standard on Assurance Engagements 3000 (Revised) - “Assurance

Engagements Other than Audits or Reviews of Historical Financial Information” adopted by

Resolution of the National Council of Statutory Auditors No. 3436/52e/2019 of April 8, 2019,

as amended (hereinafter: „NSAE 3000 (R)”).

This standard requires the auditor to plan and perform procedures to obtain reasonable

assurance that the consolidated financial statements in ESEF format were prepared in

accordance with specified criteria.

Reasonable assurance is a high level of assurance but it is not guaranteed that the

assurance engagement conducted in accordance with NSAE 3001PL and, where

appropriate, in accordance with NSAE 3000 (R), will always detect material misstatement

when it exists.

The selection of procedures depends on the auditor’s professional judgement, including the

assessment of risk of material misstatement due to fraud or error. When performing risk

assessments, and in order to design procedures to be performed the auditor takes into

consideration the internal controls related with the preparation of the consolidated

financial statements in ESEF format, which can provide the auditor with sufficient and

appropriate evidence. The assessment of the internal controls was not performed for the

purpose of expressing an opinion on the effectiveness of the Parent Company’s internal

control..

Summary of performed procedures

Procedures that were designed and performed by us included among others:

 obtaining an understanding of the process of preparation of the consolidated

financial statements in ESEF format, including the Parent Company’s process of

selection and application of XBRL tags and maintaining compliance with the ESEF

Regulation, including an understanding of the internal control system mechanisms

associated with this process;

 obtaining sufficient and appropriate evidence related to the operational

effectiveness of controls, related to XBRL-tagging, when (if, where) as part of the

risk assessment process we considered that procedures other than testing of

controls would not provide sufficient audit evidence;

 reconciliation of the tagged [on a selected sample] information included in the

consolidated financial statements in ESEF format to the audited consolidated

financial statement;

 assessment of the compliance with the technical standards on the specification of

a single electronic reporting format, including the use of the XTHML format, with

the use of specialistic IT tools, assessing the completeness of tagging the

information in the consolidated financial statements in ESEF format with XBRL tags

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 assessment whether the applied XBRL tags from the taxonomy specified by the

ESEF Regulation were applied appropriately and that extensions to the elements in

the taxonomy specified in the ESEF regulations were used when there were no

suitable elements in the taxonomy specified in the ESEF Regulations;

 evaluating of the anchoring of the taxonomy extensions to the elements in the

taxonomy specified by the ESEF Regulations;

We believe that the evidence we have obtained is sufficient and appropriate to provide a

basis for our opinion on the performed assurance engagement on the tagging compliance

with the requirements of the ESEF Regulation.

Ethical requirements, including independence

While performing the assurance engagement, the key certified auditor and the audit firm

have complied with the independence and other ethical requirements as specified by the

IESBA Code. The IESBA Code is based on the fundamental principles related to integrity,

objectivity, professional competence and due care, confidentiality and professional

behaviour. We have also complied with other independence requirements and ethical

responsibilities in accordance with required applicable rules of such assurance engagement

in Poland.

Quality control requirements

The accounting firm applies national quality control standards. As required by national

quality control standards, the audit firm has designed, implemented and applied a quality

management system, including policies or procedures regarding compliance with ethical

requirements, professional standards and applicable legal and regulatory requirements.

Opinion on compliance with the requirements of the ESEF Regulation

The matters described above constitute the basis for our opinion which is why our opinion

should be read in conjunction with these matters..

In our opinion, the consolidated financial statements in ESEF format was prepared in all

material respect in accordance with the requirements of the ESEF Regulations.

Representation on the provision of non-audit services

To the best or our knowledge and belief, we declare that we have not provided services

other than audits of the financial statements to the Parent Company and its subsidiaries, in

particular we have not rendered services other than audits, which are prohibited based on

article 5 item 1 of Regulation 537/2014 and article 136 of the Act on Statutory Auditors.

The services other than audits of the financial statements that we provided to the Parent

Company and its subsidiaries during the period under review are listed in note "Provision of

permitted services by the Auditor that are not an audit of the Directors' Report on the

activities of the DataWalk Group and DataWalk S.A.".

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Selection of the audit firm

We were appointed to audit the consolidated financial statements of the Group initially

based on the resolution of Parent Company’s Supervisory Board from 10 March 2022. The

consolidated financial statements of the Group have been audited by us uninterruptedly

starting from the financial year ended on 31 December 2018, i.e. for the past 6 consecutive

years.

The engagement partner responsible for the audit resulting in this independent auditor’s

report is Marta Jankowska.

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Registry number 13498

acting on behalf of UHY ECA Audyt Spółka z ograniczoną odpowiedzialnością with its

registered office in Warsaw, entered on the list of audit firms under number 3886 on behalf

of which the key statutory auditor audited the separate financial statement.

This document is a foreign language version of the original Independent Auditor’s Report

issued in Polish version and only the original version is binding. This document has been

prepared for information purposes and could be used only for Group’s internal purposes.

In case of any discrepancies between the Polish and English version, the Polish version shall

prevail.

Wroclaw, 10 April 2024