Grant Thornton Polska
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ul. Abpa Antoniego Baraniaka 88 E
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Polska
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Audit – Tax – Accounting – Advisory
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Grant Thornton Polska Spółka z ograniczoną odpowiedzialnością sp. k. Audit Firm No. 4055.
General partner: Grant Thornton Polska Sp. z o.o. General Partner’s Management Board: Tomasz Wróblewski – President of the Board,
Dariusz Bednarski – Vice-President of the Board, Jan Letkiewicz – Vice-President of the Board. Registered office address: ul. Abpa Antoniego Baraniaka 88 E, 61-131 Poznań,
Poland. Tax identification number NIP: 782-25-45-999. REGON: 302021882. Bank account: 31 1090 1476 0000 0001 3554 7340.
District Court Poznań – Nowe Miasto i Wilda in Poznań, 8th Commercial Division of the National Court Register, KRS No. 0000407558.
Independent
Auditor’s Report on
Consolidated
Financial Statements
For the Shareholders of Silvair, Inc.
Report on the Annual Consolidated Financial Statements
Opinion
We have audited the consolidated financial statements of the Group (the Group), in which the parent entity is
Silvair, Inc. (the Parent) with its registered office in USA, San Francisco, 717 Market Street, Suite 100, prepared
for the fulfillment of the obligations of the issuer of securities listed on the Warsaw Stock Exchange. The
consolidated financial statements comprise the consolidated statement of financial position as of December 31,
2021, and the consolidated statement of profit or loss and other comprehensive income, consolidated statement
of changes in equity, consolidated statement of cash flows for the financial year then ended, and notes,
comprising a summary of significant accounting policies and other explanatory notes.
In our opinion, the accompanying consolidated financial statements give a true and fair view of the financial
position of the Group as of December 31, 2021 and of its financial performance and of its cash flows for the
financial year then ended in accordance with the International Accounting Standards, International Financial
Reporting Standards and related interpretations published in the form of European Commission regulations and
adopted accounting principles (policy).
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing adopted as National Standards
on Auditing (NSA) by the National Council of Statutory Auditors’ resolution No. 3430/52a/2019 of March 21,
2019, as amended.
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 entities comprising the Group in accordance with the International Ethics Standards
Board for Accountants’ International Code of Ethics for Professional Accountants (including International
Independence Standards) (IESBA Code) adopted by the National Council of Statutory Auditors’ resolution No.
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3431/52a/2019 of March 25, 2019 together with the ethical requirements that are relevant to our audit of the
financial statements in Poland. We have fulfilled our other ethical responsibilities in accordance with these
requirements and the IESBA Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Material Uncertainty Related to Going Concern
The Board of Directors of the Parent in the note to the consolidated financial statements „Basis of Going
Concern” informed that in connection with the current proceeds from sales do not yet allow for full financing of
the operating and development activities of the Group in the next 12 months. This situation indicates the
existence of a material uncertainty which may cause significant doubt on the Company’s ability to continue as a
going concern. In the aforementioned note, the Board of Directors outlined activities aimed to reduce these risk.
In the opinion of the Board of Directors, these activities will be successful, however, there is no such certainty.
Our opinion is not modified in respect of this matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in the audit of
the consolidated financial statements of the current period. They include the most significant assessed risks of
material misstatement, including assessed risk of material misstatement due to fraud. These matters were
addressed in the context of the audit of the consolidated financial statements as a whole, and in forming the
auditor’s opinion thereon. In addition to the matter described in the Material Uncertainty Related to Going
Concern section, we have determined the matters described below to be the key audit matters to be
communicated in our report. Below, we provided a summary of our response to those risks and where relevant,
key observations arising with those risks. We do not provide a separate opinion on these matters.
Expenditure on research and development work (ongoing and completed)
Description
In the consolidated statement of financial position as of December 31, 2021 the Group presents significant
expenses for research and development (uncompleted or completed) amounting to 10 430 thousand dollars.
Due to the significant share in the assets (83%) and significant judgments and estimates of the Board of
Directors being the assumptions underlying the valuation, we considered this matter as the key issue of the
audit. Disclosures regarding research and development are presented in the note 1.1 to the consolidated
financial statement.
Auditor’s response
During conducting the audit we have documented our understanding of the process allocating expenses for
research and development (R&D), the moment of acceptance for use, methods and depreciation rate of
completed R&D.
Performed procedures included:
• detailed audit of allocation expenses for research and development,
• assessment of the premises and impairment loss of the completed and uncompleted projects,
• assessment of depreciation rates of completed R&D projects,
• analysis of the completeness of the disclosures.
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Responsibilities of Board of Directors and Audit Committee of the Parent for the Consolidated
Financial Statements
The Board of Directors of the Parent is responsible for the preparation of these consolidated financial
statements that give a true and fair view of the financial position, financial performance and cash flows of the
Group in accordance with the International Accounting Standards, International Financial Reporting Standards
and related interpretations published in the form of European Commission regulations, adopted accounting
principles (policy), legal regulations, and the Parent’s articles of association. The Board of Directors of the
Parent is also responsible for such internal control as the Board of Directors determines is necessary to enable
the preparation of consolidated financial statements that are free from material misstatements, whether due to
fraud or error.
In preparing the consolidated financial statements, the Board of Directors of the Parent is responsible for
assessing 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 the Board of Directors of the Parent either
intends to liquidate the Group or to cease the operations, or has no realistic alternative but to do so.
The Audit Committee of the Parent is responsible for overseeing the Group’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated 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 NSAs 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.
As part of an audit in accordance with NSAs, we exercise professional judgment and maintain professional
scepticism throughout the audit. 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 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 Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the Board of Directors of the Parent.
• Conclude on the appropriateness of the Board of Directors of the Parent’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 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 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.
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• 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 the Audit Committee of the Parent 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 the Audit Committee of the Parent 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 matters communicated with the Audit Committee of the Parent, 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 the 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 the Report on the Group’s operations
The other information comprises the Report on the Group’s operations for the financial year ended
December 31, 2021, the Corporate Governance Statement which is a separate part of the Report on the
Group’s operations and the Annual Report for the year ended December 31, 2021 (but does not include the
consolidated financial statements and our auditor’s report thereon).
Responsibilities of the Board of Directors and the Audit Committee of the Parent
The Board of Directors of the Parent is responsible for the preparation of the other information.
Responsibilities of the Auditor
Our opinion on the consolidated financial statements does not cover the other information and we do not
express any form of assurance conclusion thereon that results from NSAs. In connection with our audit of the
consolidated financial statements, our responsibility is to read the other information and, in doing so, consider
whether it is materially inconsistent with the consolidated 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 the other information, we are required to report that fact. Additionally,
according to the Regulation of the Minister of Finance of March 29, 2018 on current and periodic information
disclosed by issuers of securities and the conditions for recognition as equivalent of the information required by
law of a non-member state (Journal of Laws of 2018, item 757) (the Regulation on current and periodic
information), we are obliged to on whether the Company prepared the Statement on non-financial information
and to express an opinion on whether the Company included the required information in the Corporate
Governance Statement.
Opinion on the Corporate Governance Statement
In our opinion, the Corporate Governance Statement includes the information required by Paragraph 70 clause
6 point 5 of the Regulation on current and periodic information. The information specified in Paragraph 70
clause 6 point 5 letters c-f, h and i of the Regulation on current and periodic information included in the
Corporate Governance Statement complies with applicable regulations and is consistent with the information
included in the consolidated financial statements.
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Report on Other Legal and Regulatory Requirements
Opinion on the compliance of marking up of the consolidated financial statements prepared in a
single electronic reporting format with the requirements of the regulation on technical standards on
the specification of a single electronic reporting format
In connection with the audit of the consolidated financial statements, we have been engaged to perform a
reasonable assurance engagement to express an opinion on whether the consolidated financial statements of
the Group as at and for the year ended December 31, 2021, prepared in a single electronic reporting format
contained in the file named SILVAIR_2021-12-31_PL.zip (consolidated financial statements in the ESEF
format) have been marked up in accordance with the requirements set out in the Commission Delegated
Regulation (EU) 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 specification of a single
electronic reporting format (ESEF Regulation).
Identification of the criteria and description of the subject matter of the engagement
The consolidated financial statements in the ESEF format were prepared by the Board of Directors of the
Parent in order to meet the marking requirements and technical requirements for the specification of a single
electronic reporting format, as set out in the ESEF Regulation.
The subject matter of our assurance engagement is to verify the compliance of marking up of the consolidated
financial statements in the ESEF format with the requirements of the ESEF Regulation, and we believe that the
requirements set out in the regulations form appropriate criteria for expressing our opinion.
Responsibility of the Parent’s Board of Directors and Audit Committee
The preparation of consolidated financial statements in the ESEF format in accordance with the marking
requirements and technical requirements for the specification of a single electronic reporting format, as set out
in the ESEF Regulation, is the responsibility of the Parent’s Board of Directors. The responsibility includes the
selection and application of appropriate XBRL markups with the use of the taxonomy defined in those
regulations.
The responsibility of the Parent’s Board of Directors also includes the design, implementation and maintenance
of an internal control system to ensure the preparation of consolidated financial statements in the ESEF format
free from material non-conformities with the requirements of the ESEF Regulation.
Members of the Parent’s Audit Committee are responsible for overseeing the financial reporting process,
including the preparation of financial statements in accordance with the format resulting from applicable laws.
Auditor’s Responsibility
Our objective was to express an opinion, on the basis of a reasonable assurance engagement, whether the
consolidated financial statements in the ESEF format have been marked up in accordance with the
requirements of the ESEF Regulation.
We performed the engagement in accordance with National Standard for Assurance Engagements other than
Audits or Reviews 3001PL Audit of Financial Statements Prepared in a Single Electronic Reporting Format,
which was adopted by resolution of the National Council of Statutory Auditors No. 1975/32a/2021 of December
17, 2021 (NSAE 3001PL) and, where relevant, in accordance with National Standard for Assurance
Engagements other than Audits or Reviews 3000 (R) in the wording of International Standard on Assurance
Engagements (ISAE) 3000 (revised) Assurance Engagements other than Audits or Reviews of Historical
Financial Information, which was adopted by resolution of the National Council of Statutory Auditors No.
3436/52e/2019 of April 8, 2019, as amended (NSAE 3000 (R)).
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The standard imposes on a statutory auditor an obligation to plan and perform procedures in such a manner as
to obtain reasonable assurance that consolidated financial statements in the ESEF format have been prepared
in accordance with the specified criteria. Reasonable assurance means a high level of assurance, but it does
not guarantee that an engagement performed in accordance with NSAE 3001PL and, where relevant, in
accordance with NSAE 3000 (R), would always detect an existing material misstatement.
The selection of the procedure depends on the statutory auditor’s judgement, including their estimation of the
risks of material misstatement, whether due to fraud or error. When assessing the risk, the statutory auditor
considers internal control associated with the preparation of consolidated financial statements in the ESEF
format in order to plan the relevant procedures which are to provide the auditor with sufficient and appropriate
evidence. The assessment of the functioning of the internal control system was not conducted for the purpose
of expressing an opinion on the effectiveness of its functioning.
Summary of the work performed
The procedures planned and performed by us included, among others:
• obtaining an understanding of the process of preparation of consolidated financial statements in the
ESEF format, covering the process of the Board of Directors of the Parent selection and application of
XBRL markups and ensuring compliance with the ESEF Regulation, including understanding of the
internal control system mechanisms related to the process;
• reconciliation of the marked up information contained in the consolidated financial statements in the
ESEF format with the audited consolidated financial statements;
• assessment of compliance with technical standards on the specification of a single electronic reporting
format, including the application of the XHTML format, using specialist IT tools;
• assessment of the completeness of marking of information in the consolidated financial statements in
the ESEF format with XBRL markups;
• assessment whether the XBRL markups from the taxonomy defined in the ESEF Regulation have
been properly applied and whether extension taxonomies have been used in situations where the core
taxonomy specified in the ESEF Regulation has not identified the relevant elements;
• assessment whether the applied extension taxonomies have been properly anchored in the core
taxonomy defined in the ESEF Regulation.
We believe that the evidence we have obtained provides sufficient and appropriate basis for us to express an
opinion on the compliance of marking up with the requirements of ESEF Regulation.
Ethical requirements, including independence
In performing the engagement, the statutory auditor and the audit firm complied with the independence
requirements and other ethical requirements set out in the IESBA Code. The IESBA Code is based on
fundamental principles relating to integrity, objectivity, professional competencies and due diligence,
confidentiality and professional conduct. We also complied with other independence and ethics requirements
that apply to this assurance engagement in Poland.
Quality control requirements
The audit firm applies national quality control standards in the wording of the International Quality Control
Standard 1 Quality Control for Firms that Perform Audits and Reviews of Financial Statements and Other
Assurance and Related Services, adopted by resolution of the National Council of Statutory Auditors No
2040/37a/2018 of March 3, 2018, as amended (NQCS).
In accordance with the NQCS requirements, the audit firm maintains a comprehensive quality control system
that includes documented policies and procedures for compliance with ethical requirements, professional
standards and applicable legal and regulatory requirements.
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Opinion on the compliance with the requirements of ESEF Regulation
The statutory auditor’s opinion is based on the matters described above, therefore, the opinion should be read
in consideration of these matters.
In our opinion, the consolidated financial statements in the ESEF format have been marked up, in all material
respects, in accordance with the requirements of the ESEF Regulation.
Basis for Audit
The accompanying financial statements is not the consolidated financial statements within the meaning of
regulations in force in Poland. Our audit of these consolidated financial statements is not an audit within the
meaning of provision of on the Act of May 11, 2017 on statutory auditors, audit firms, and public supervision
(Journal of Laws of 2020, item 1415 as amended).
Renata Art-Franke
Statutory Auditor No. 10320.
Key Audit Partner performing the audit on behalf of
Grant Thornton Polska Spółka z ograniczoną odpowiedzialnością sp. k.,
Poznań, ul. Abpa Antoniego Baraniaka 88 E, Audit Firm No. 4055
Poznań, April 26, 2022.
THIS IS TRANSLATION ONLY. The Polish language version of the report is the only valid and legally binding
version. This translation into English is provided to facilitate understanding of the report.
