FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
INVESTMENT FRIENDS CAPITAL SE
ANNUAL REPORT
FOR THE PERIOD SINCE 01 JULY 2022 TILL 30 JUNE 2023
AND FOR THE YEAR ENDED ON 30 JUNE 2023
PREPARED IN COMPLIANCE WITH INTERNATIONAL
FINANCIAL REPORTING STANDARDS
Tallinn, 28/09/2023
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
2
INVESTMENT FRIENDS CAPITAL SE
GENERAL INFORMATION
Business name: INVESTMENT FRIENDS CAPITAL SE
Registry code: 14618005
LEI code: 259400IJV1V3TF45QC25
Address: Harju maakond, Tallinn, Kesklinna linnaosa, Tornimäe tn 5, 10145
Telephone: +48-796-118-929
E-mail address: biuro@ifcapital.pl
Website: www.ifcapital.pl
Reporting period: 01/07/2022 - 30/06/2023
Auditor: Number RT OÜ, Eve Leppik, license no: 230
Members of the Supervisory Board:
Wojciech Hetkowski
Jacek Koralewski
Małgorzata Patrowicz
Martyna Patrowicz
Members of the Management Board:
Damian Patrowicz
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
3
TABLE OF CONTENTS
I. SELECTED FINANCIAL DATA……....…………………….………………..……………….…4
II. LETTER OF MANAGEMENT BOARD…………………………..............………………….…5
III. MANAGEMENT REPORT.........................................................................................…….....…6
IV. CORPORATE GOVERNANCE REPORT…..…………………………...………………….....12
V. REMUNERATION REPORT........................................................................................................18
VI. FINANCIAL STATEMENTS……....……………………………......……………………..…...19
1. Balance sheet….………..………………………….........……….……….…...........….........19
2. Statement of profit or loss.............…......................................................................................20
3. Statement of comprehensive income……….………...………..…....….............….......…....20
4. Statement of changes equity……....……….………...………..…....……....................….....21
5. Cash flow statement…….…………....…………...………..…....……..........................…....22
6. Notes to the financial statement…….……..……...………..…....……..........................…....23
VII. MANAGEMENT BOARD’S CONFIRMATION OF THE ANNUAL
REPORT................................................................................................................................................43
INDEPENDENT AUDITOR’S REPORT.............................................................................................44
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
4
I. SELECTED FINANCIAL DATA
in thous. EUR
Twelve months
ended on
30/06/2023
Twelve months
ended on
30/06/2022
Revenues from the interest
158
143
Profit (loss) from operating activities
139
129
Profit (loss) before taxes
142
129
Profit (loss) for the period
142
129
Net cash flows (outflows) from operating
activities
0
-5
Change in cash and cash equivalents
0
-5
Total assets
5 001
4 828
Short-term liabilities
5
6
Equity
4 996
4 822
Share capital
10 511
10 511
Number of shares (in pcs.)
105 111 804
105 111 804
Book value per share (in EUR)
0,05
0,05
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
5
II. LETTER OF THE MANAGEMENT BOARD
Dear Sirs,
On behalf of the Management Board of Investment Friends Capital SE, I am pleased to
present to you the Annual Report for the period since July 1, 2022 to June 30, 2023.
During this period, the Company continued to provide financial services, i.e. lending
activities, which constitute the main part of the revenues generated by the Company. In the
opinion of the Management Board, the Company's situation is stable and there is no liquidity risk
and no threat to the going concern. According to the Management Board's intentions, the
Company will continue to focus on providing financial services in the new financial year, in
particular granting loans to business entities.
On behalf of the Management Board, I hope that consistent achievement of the assumed
economic goals and cost reduction will allow us to achieve positive financial results that will meet
the expectations of our Shareholders. I would also like to thank all Shareholders for the trust they
have placed in the Company and Co-operators, wishing them further, mutually fruitful
cooperation.
Yours faithfully;
Damian Patrowicz
Member of the Management Board
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
6
III. MANAGEMENT REPORT
THE MAIN FIELDS OF ACTIVITY
The main business activity of the Company is financial activity, including lending activities. The
Company realizing its main activity related to lending services concluded agreements with Polish
and Estonian business entities. The Company intends to continue its operations in the area of
lending activities.
In the reporting period, the Company obtained revenues mainly from its financial service activity,
i.e. interest on loans granted.
GENERAL (MACROECONOMIC) DEVELOPMENT
The Company undertakes financial activities, especially related to granting loans to business
entities, mostly to related parties. Entrepreneurs who have not obtained financing from a bank,
usually reach out to companies which provide lending services and declare high flexibility
depending on the needs of a particular customer and their collateral capabilities. The Company
notices development potential in the field of providing financial services for this kind of entities
and, accordingly, intends to continue its business activity in this segment. As at the date of
publication of the annual report, Investment Friends Capital SE has two significant borrowers -
related parties. The operating activity of one of the main borrowers is focused on investments in
the capital market. Therefore, the level of interest rates may indirectly affect the fulfillment of
obligations to repay loans, which may affect the valuation of assets on stock exchanges. The
operating activity of the second borrower is the further granting of loans at a fixed interest rate.
During the last twelve months, mature stock markets have not experienced any bigger turbulence.
The valuation of the world's main stock markets increased despite the increase in interest rates
(EU, USA).
FINANCIAL INSTRUMENTS, FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The main risks arising from financial instruments of the Company are: interest rate risk, liquidity
risk and credit risk. The Management Board is responsible for establishing of risk management in
the Company as well as for supervision of their compliance. The purpose of the Company's risk
management policies is to identify and analyze the risks to which the Company is exposed,
establishing appropriate restrictions and controls, as well as by monitoring adjusted risks and
limits accordingly. The Management Board identifies potential risks by analyzing each transaction
of the Company. Due to the simple structure of the Company, there are no problems with
communicating information in a timely manner. The management board is responsible for
designing, introducing and ensuring adequate and effective actions aimed at achieving the goal.
Also, appropriate experience and education of the management board allows to minimize the
influence of risks on the operating activity. The Management Board measures and identifies each
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
7
transaction separately. The Management Board monitors events that may have an impact on the
emergence of a given risk on an ongoing basis. Risk identification involves identifying actual and
potential risk sources and then analyzing for materiality.
THE STRUCTURE OF THE SHARE CAPITAL
Since May 28, 2007 shares of Investment Friends Capital SE are listed on Warsaw Stock
Exchange. As at the balance-sheet date 30/06/2023 Investment Friends Capital SE holds
105.111.804 issued shares. As at 30/06/2023 the price per share on the Warsaw Stock Exchange
was PLN 1,43 PLN (0,32 EUR). While at 30/06/2022 the price on the Warsaw Stock Exchange
was 1,025 PLN (0,22 EUR).
As at 30/06/2022 and 30/06/2023 the share capital of the Company amounted to:
EUR 10 511 180 and was divided into 105.111.804 bearer shares without par value.
As at the balance sheet date, 30/06/2023, the Company’s equity is less than 50% of the share
capital and does not comply with the requirements of § 301 of the Commercial Code of Estonia.
The Management Board of Investment Friends Capital SE will propose to the general meeting to
reduce the share capital of the Company. The Company has convened a general meeting for
October 6, 2023 during which the share capital will be allocated to the share premium. Thus, the
requirement set out in § 301 of the Commercial Code of Estonia will be met.
INFORMATION OF THE COMPANY AND SHAREHOLDERS
As at the balance sheet date 30/06/2023 Investment Friends Capital SE has no subsidiaries and it
does not create its own consolidation group.
According to the best knowledge of the Management Board the direct shareholder is Patro Invest
OǕ headquartered in Tallinn that owns 71,24% contribution in the share capital and 71,24% votes
at the general Meeting of Shareholders of the Company as at 30/06/2023.
As at 30/06/2023 the Company did not own any capital investments in the form of shares and
stock of other entities.
As at the balance sheet date 30/06/2023, according to the Management Board’s best knowledge,
the structure of direct and indirect shareholders holding at least 5% of the total number of votes at
the General Meeting was as follows:
Structure of direct shareholding as at 30/06/2023
No.
Direct shareholders
Number of
shares
% of shares
Number of votes
% of votes
1.
Patro Invest OÜ
74 878 260
71,24
74 878 260
71,24
X
Total
105 111 804
100,00
105 111 804
100,00
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
8
Structure of indirect shareholding as at 30/06/2023
No.
Indirect shareholders
Number of
shares
% of shares
Number of votes
% of votes
1.
Damian Patrowicz
74 878 260
71,24
74 878 260
71,24
* Damian Patrowicz owns 100% of Patro Invest OU
According to the information presented in the 2021/2022 year, the structure of direct and indirect
shareholders holding at least 5% of the total number of votes at the General Meeting was as
follows:
Structure of direct shareholding as at 30/06/2022
No.
Direct shareholders
Number of
shares
% of shares
Number of votes
% of votes
1.
Patro Invest OÜ
74 878 260
71,24
74 878 260
71,24
X
Total
105 111 804
100,00
105 111 804
100,00
Structure of indirect shareholding as at 30/06/2022
No.
Indirect shareholders
Number of
shares
% of shares
Number of votes
% of votes
1.
Damian Patrowicz
74 878 260
71,24
74 878 260
71,24
* Damian Patrowicz owns 100% of Patro Invest OU
SHARES OWNED BY MEMBERS OF THE COMPANY’S MANAGEMENT AND SUPERVISORY
BOARD:
Members of the Management Board
As at the balance sheet date 30/06/2023 and as at the date of submitting the annual report, the
Chairman of the Management Board Mr. Damian Patrowicz owns indirectly shares of the
Company. According to the best knowledge of the Management Board Mr. Damian Patrowicz
indirectly owns, via his company Patro Invest OÜ, 74 878 260 shares of Investment Friends
Capital SE, constituting 71,24% of the share capital of the Company.
Members of the Supervisory Board
According to the knowledge of the Management Board of Investment Friends Capital SE,
Members of the Supervisory Board do not own directly and indirectly shares of the Company as at
the balance sheet date and as at the date of submitting of the annual report.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
9
ELECTION OF THE MANAGEMENT BOARD AND THE SUPERVISORY BOARD
In accordance with the provisions of point 5.3 of the Company's Articles of Association, members
of the Company’s Management Board are appointed and dismissed by the Supervisory Board,
which also decides on the remuneration of members of the Management Board. Members of the
Supervisory Board are elected by the Company's general meeting of shareholders.
RESOLUTIONS AND RULES FOR AMENDMENT OF THE ARTICLES OF ASSOCIATION OF
THE COMPANY
In accordance with point 4.8.1 of the Company's Articles of Association, any amendment of the
Company’s Articles of Association is included in the General Meeting of Shareholders’
competencies.
In accordance with point 4.5 of the Articles of Association, the General Meeting is able to adopt
valid resolutions, if more than half of all votes are represented at the General Meeting, if the
applicable legal acts do not provide for a higher majority of votes.
If an enough number of shareholders does not participate in General Meeting, in order to ensure a
majority of votes, in accordance with point 4.5, the Management Board of the Company within
three weeks, but not earlier than after seven days, convenes a new general meeting with the same
agenda. In this way, the General Meeting is competent to adopt resolutions regardless of the
number of votes represented. Resolutions of the general meeting are adopted, when more than half
of all votes represented at the General Meeting support the resolution, and there is no other
requirement arising from applicable legal acts.
DESCRIPTION OF SIGNIFICANT EXTERNAL AND INTERNAL FACTORS
Considering the specifics of the activity, i.e., financial service activities in the field of granting
loans, the results are significantly influenced by:
- the general situation on the loan market and the level of interest rates,
- the proper fulfilment by the Borrowers of their obligations resulting from concluded loan
agreements, as well as the progress of the enforcement procedure and the collection of overdue
loans, if such agreements occur,
- borrowers' field of activity and related risks,
- efficiency of administrative and legal procedures,
- opportunity to gain new borrowers,
- the economic situation and investment conditions in Poland, Estonia and the entire region,
- access to external financing sources,
- cooperation with other financial entities.
The risk related to the possibility of fluctuations in the exchange rate of one currency in relation to
another may lead to both deterioration and improvement of the financial situation of the Company.
The Company's revenues and operating cash flows are not dependent of changes in market interest
rates because the contracts are not concluded at variable interest rates
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
10
Significant factors of risks are described on pages 33-36 of the annual report.
Despite the weakening of the PLN against the EUR in the last financial year, this did not affect the
company's profitability. The change in interest rates also had no effect, as the Company provides
financing with a fixed interest rate
INFORMATION ON AVERAGE EMPLOYMENT
The Company did not have any employees in the financial year lasting since July 1, 2022 to June
30, 2023 and in the previous financial year since July 1, 2021 to June 30, 2022.
INFORMATION REGARDING THE SELECTED AUDITOR AND THE CONTRACT SIGNED WITH
THEM
According to the Company’s Articles of Association, the right to elect a certified auditor is at the
General Meeting of Shareholders. On 04/05/2022, the General Meeting of Shareholders elected
the auditing company Number RT OÜ as the auditor.
Remuneration for the Auditor will be paid in accordance with the Agreement concluded between
the Company and Number RT OÜ, which was established on market conditions. The audit fee for
the financial year lasting since 01/07/2022 to 30/06/2023 amounted to 4.800 EUR and the audit
fee for the previous financial year lasting since 1/07/2021 to 30/06/2022 amounted to 4.800 EUR.
OTHER SIGNIFICANT INFORMATION
EVENTS THAT TOOK PLACE DURING THE FINANCIAL YEAR AND AFTER ITS
END
Submission of a lock-up commitment by Patro Invest OÜ.
Patro Invest OÜ informed that until October 31, 2023 it will not transfer the ownership of all
shares admitted to trading as at this day i.e. 2 390 000 shares.
Cancellation of suspension of the Company's listing on the Warsaw Stock Exchange.
On June 21, 2023 the Warsaw Stock Exchange, at the request of the Polish Financial Supervision
Authority cancelled the suspension of the Company's listings which had been suspended since
March 30, 2022.
Ordinary General Meeting of Shareholders on July 21, 2023.
On July 21, 2023 a general meeting was held at which the term of office of the existing members
of the supervisory board was extended and the financial statements for the financial year
2021/2022 were approved.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
11
Selected indicators of Investment Friends Capital SE:
Indicators
30/06/2023
30/06/2022
Total assets (in thous. EUR)
5 001
4 828
Return on Assets (ROA)
2,84%
2,67%
Equity (in thous. EUR)
4 996
4 822
Return on equity (ROE)
2,84%
2,68%
Net profitability
89,87%
90%
Debt ratio
0,10%
0,12%
Profit (loss) for the period (in thous. EUR)
142
129
Shares
30/06/2023
30/06/2022
Price per share (EUR) on the WSE
0,32
0,22
Earnings per share (EUR)
0,00
0,00
Price-to-earnings ratio (P/E)
236,87
179,26
Book value per share (EUR)
0,05
0,05
Price-to-book value (P/BV) ratio
6,73
4,40
Liquidity ratio
727,2
77,17
Market capitalization (in thous. EUR)
33 636
23 125
Return on assets = profit (loss) for the period / total assets
Return on equity = profit (loss) for the period / equity
Net profitability = profit (loss) for the period / revenue from interest
Debt ratio = liabilities / total assets
Price-per-share = market cap / number of shares;
Profit per share = profit (loss) for the period / number of shares
Price-to-earnings (P/E) ratio = market cap / profit (loss) for the period
Book value per share = total equity / number of shares
Price-to-book value (P/BV) ratio = market cap / book value
Liquidity ratio = current assets / short-term liabilities
Market capitalization = price per share on the WSE * number of shares
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
12
IV. CORPORATE GOVERNANCE REPORT
The Company's statement regarding the compliance with the Best Practice for The Warsaw Stock
Exchange (GPW) Listed Companies 2021 and Corporate Governance Principles is available on
the Company's website www.ifcapital.pl, in the "Regulations" section, the "Good practices" on
corporate governance.
In 2022/2023 Investment Friends Capital SE was subject to the corporate governance standards
contained in the document Best Practice for GPW Listed Companies 2021, which were adopted by
resolution of the Stock Exchange Supervisory Board no. 13/1834/2021 of March 29, 2021 for
companies listed on the GPW Main Market - "Best Practice for GPW Listed Companies 2021"
(Best Practice 2021). In fulfilling disclosure requirements regarding the application of corporate
governance standards, Investment Friends Capital SE is guided by the principles of an effective
and transparent information policy and communication with the market and investors.
The Company applied all the corporate governance principles contained in the ‘Best Practice for
GPW Listed Companies 2021’, except for the following:
DISCLOSURE POLICY, INVESTOR COMMUNICATIONS
1.2. Companies make available their financial results compiled in periodic reports as soon as
possible after the end of each reporting period; should that not be feasible for substantial reasons,
companies publish at least preliminary financial estimates as soon as possible.
Comments of the Company
:
The Company publishes periodic reports within deadlines arising
from applicable Estonian law.
1.3. Companies integrate ESG – (environmental, social, and governance) factors in their business
strategy, including in particular:
1.3.1. environmental factors, including measures and risks relating to climate change and
sustainable development
Comments of the Company: The main activity of the Company is granting loans. Therefore, the
activity of the Company does not have significant impact on the environment. The Company
makes efforts to ensure that its activity have the least possible impact on the natural environment.
1.3.2. social and employee factors, including to ensure equal treatment of women and men, decent
working conditions, respect for employees’ rights, dialogue with local communities, customer
relations.
Comments of the Company: The Company explains that the principles of sustainable
development and respect for social and employee rights and interests are applied in the strategy of
its activity. In this regard, the Company complies with all applicable laws and guidelines. At the
time of publication of this report, no written rules have been drawn up because there are no
employees.
1.4. To ensure quality communications with stakeholders, as a part of the business strategy,
companies publish on their website information concerning the framework of the strategy,
measurable goals, including in particular long-term goals, planned activities and their status,
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
13
defined by measures, both financial and non-financial. ESG information concerning the strategy
should among others:
Comments of the Company: The Company publishes a number of financial and non-financial
measures, as well as information on the adopted development strategy both on the Company’s
website and by publishing current and periodic reports. The Company indicated that it does not
publish information on its development plans and the progress of their implementation separately.
The Company also does not publish any forecasts.
1.4.1 explain how the decision-making processes of the company integrate climate change,
including the resulting risks.
Comments of the Company: Due to the above-mentioned in point 1.3.1. marginal impact of the
Company's activity on the natural environment, the Company does not publish additional
explanations in this scope.
1.4.2. present the equal pay index for employees, defined as the percentage difference between the
average monthly pay (including bonuses, awards and other benefits) of women and men in the last
year, and present information about actions taken to eliminate any pay gaps, including a
presentation of related risks and the time horizon of the equality target.
Comments of the Company: Due to the fact that the Company has no employees, it is not
appropriate to disclose this information.
1.5. Companies disclose at least on an annual basis the amounts expensed by the company in
support of culture, sports, charities, the media, social organisations, trade unions, etc. If the
company pay such expenses in the reporting year, the disclosure presents a list of such expenses.
Comments of the Company: The Company does not conduct sponsorship activities.
MANAGEMENT BOARD, SUPERVISORY BOARD
2.1. Companies should have in place a diversity policy applicable to the management board and
the supervisory board, approved by the supervisory board and the general meeting, respectively.
The diversity policy defines diversity goals and criteria, among others including gender, education,
expertise, age, professional experience, and specifies the target dates and the monitoring systems
for such goals. With regard to gender diversity of corporate bodies, the participation of the
minority group in each body should be at least 30%.
Comments of the Company: Crucial personnel decisions in relations to the Company’s governing
bodies and its key managers are taken by the General Meeting and the Supervisory Board.
2.3. At least two members of the supervisory board meet the criteria of being independent referred
to in the Act of 11 May 2017 on Auditors, Audit Firms and Public Supervision, and have no actual
and material relations with any shareholder who holds at least 5% of the total vote in the company.
Comments of the Company: The decision to elect Members of the Supervisory Board is within
the competence of the General Meeting of Shareholders. Shareholders act on the basis of their
competences and trust in individual candidates, appoint the composition of the Supervisory Board.
Depending on the decision of the General Meeting, the Company may or may not fulfil this
criterion periodically, depending on the selected composition of the Supervisory Board. Currently,
the Supervisory Board does not fulfil the independence criteria, as only one member of the
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
14
Supervisory Board is independent, and assessment of the risk resulting from this is within the
competence of the General Meeting.
2.11. In addition to its responsibilities laid down in the legislation, the supervisory board prepares
and presents an annual report about activities of supervisory board to general meeting once per
year.
Comments of the Company: In accordance with the applicable provisions of the Estonian law, the
Company does not publish or submit a report on activities of the Supervisory Board to the General
Meeting for approval.
INTERNAL SYSTEMS AND FUNCTIONS
3.9. The supervisory board monitors the efficiency of the systems and functions referred to in
principle 3.1 among others on the basis of reports provided periodically by the persons responsible
for the functions and the company’s management board, and makes annual assessment of the
efficiency of such systems and functions according to principle 2.11.3.
Comments of the Company: In accordance with the applicable provisions of the Estonian law, the
Company does not publish or submit a report on activities of the Supervisory Board to the General
Meeting for approval.
GENERAL MEETING, SHAREHOLDER RELATIONS
4.1. Companies should enable their shareholders to participate in a general meeting by means of
electronic communication (e-meeting) if justified by the expectations of shareholders notified to
the company, provided that the company is in a position to provide the technical infrastructure
necessary.
Comments of the Company: The Company considers that the costs of enabling shareholders to
participate in the general meeting by means of electronic communication (e-meeting) are too high.
Nevertheless, the Management Board indicates, that the structure of the Company’s shareholding
means that the shareholders are not interested in participating in the Company’s general meeting
in electronic form. At the same time, the Company's Articles of Association and the Regulations
of the General Meeting do not prescribe the possibility of participating in the Meeting by means of
electronic communication.
4.3. Companies provide a public real-life broadcast of the general meeting.
Comments of the Company: The Company recognizes that the costs of broadcasting the General
Meeting are too high. At the same time, the Management Board indicates that the Company's
shareholding structure causes the lack of interest in the General Meeting. At the same time, the
Company's Articles of Association and the General Meeting Regulations do not prescribe
transmission of the meeting.
4.6. To help shareholders participating in a general meeting to vote on resolutions with adequate
understanding, draft resolutions of the general meeting concerning matters and decisions other
than points of order should contain a justification, unless it follows from documentation tabled to
the general meeting. If a matter is put on the agenda of the general meeting at the request of a
shareholder or shareholders, the management board requests presentation of the justification of the
proposed resolution, unless previously presented by such shareholder or shareholders.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
15
Comments of the Company: As at the date of publication of this report, the Company does not
publish any additional justification for the draft resolutions of the General Meeting. So far, the
shareholders of the Company have not expressed interest in the additional discussion of the matter
of General Meetings.
Shareholders with major holdings
As at the balance sheet date 30/06/2023, according to the Management Board’s best knowledge,
the structure of direct and indirect shareholders holding at least 5% of the total number of votes at
the General Meeting was as follows:
Structure of direct shareholding as at 30/06/2023
No.
Direct shareholders
Number of
shares
% of shares
Number of votes
% of votes
1.
Patro Invest OÜ
74 878 260
71,24
74 878 260
71,24
X
Total
105 111 804
100,00
105 111 804
100,00
Structure of indirect shareholding as at 30/06/2023
No.
Indirect shareholders
Number of
shares
% of shares
Number of votes
% of votes
1.
Damian Patrowicz
74 878 260
71,24
74 878 260
71,24
* Damian Patrowicz owns 100% of Patro Invest OU
According to the information presented in the 2021/2022 year, the structure of direct and indirect
shareholders holding at least 5% of the total number of votes at the General Meeting was as
follows:
Structure of direct shareholding as at 30/06/2022
No.
Direct shareholders
Number of
shares
% of shares
Number of votes
% of votes
1.
Patro Invest OÜ
74 878 260
71,24
74 878 260
71,24
X
Total
105 111 804
100,00
105 111 804
100,00
Structure of indirect shareholding as at 30/06/2022
No.
Indirect shareholders
Number of
shares
% of shares
Number of votes
% of votes
1.
Damian Patrowicz
74 878 260
71,24
74 878 260
71,24
* Damian Patrowicz owns 100% of Patro Invest OU
Holders of securities that give specific control rights and a description of those rights
Investment Friends Capital SE shares do not confer any specific control rights.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
16
Restrictions on voting rights
Such restrictions do not apply to the Company's shares.
Restrictions on transferability of ownership of the Company's shares
In accordance with the Articles of Association of Investment Friends Capital SE, there are no
restrictions on transferability of ownership of the Company's shares.
Rules governing the appointment and removal of management members and their rights
The listed company Investment Friends Capital SE is managed by the Management Board, its
members act in the interest of the Company and are responsible for its activities. The activities of
the Management Board include, in particular, managing the Company, commitment to setting its
strategic goals and their implementation, as well as ensuring the Company efficiency and security.
The Company is supervised by an effective and competent Supervisory Board. Members of the
Supervisory Board act in the interest of the Company and are guided by the independence of their
own opinions and decisions. The Supervisory Board, in particular, makes recommendations on the
Company's strategy and controls the work of the Management Board in achieving strategic goals
and monitors the achieved results. The Members of the Management Board are appointed by the
Supervisory Board and the Members of the Supervisory Board are elected by the Company's
general meeting of shareholders. (Article of Association, point IV).
Amendments to the Articles of Association
Amendments to the Articles of Association require a resolution of the General Meeting. The
notice convening a General Meeting whose agenda includes amendments to the Articles of
Association should contain existing provisions of the Articles of Association and the proposed
amendments. Where justified by a significant scope of the intended amendments, the notice may
include a draft of a new text of the Articles of Association together with a list of its new or
amended provisions. The text of the Articles of Association is available on the Company's website
at: http://www.ifcapital.pl/statut.php
Proceedings of the General Meetings and its powers
The General Meetings of the Company are held in accordance with the rules set out in the
Commercial Code, the Articles of Association of Investment Friends Capital SE and the
applicable capital market laws.
Composition of the Management Board and description of the activities of the Company’s
management and supervisory bodies in 2022/2023:
Management Board:
Damian Patrowicz
Supervisory Board:
Wojciech Hetkowski
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
17
Jacek Koralewski
Małgorzata Patrowicz
Martyna Patrowicz
The main task of the Management Board is to manage the Company's activities and represent it,
but is also responsible for planning, implementing and ensuring adequate and effective actions
aimed at achieving the goal. The Supervisory Board exercises permanent supervision over the
Company's activities in all areas of its operations. The main duties of supervisory board members
also include appointing, dismissing and suspending members of the Company's management
board, delegating members of the supervisory board to perform tasks in replace the members of
the management board. Due to the simple structure of the Company, there are no problems with
communicating information in a timely manner between the Management Board and the
Supervisory Board.
Description of the company’s internal control systems and risk management with regard to
the process of preparing financial statements.
The Management Board of the Company is responsible for the internal control system in the
Company and its effectiveness in terms of the correctness of preparing financial statements and
periodic reports. Financial statements and periodic reports are prepared on the basis of financial
data from the financial and accounting system, where they are recorded in accordance with the
principles of the adopted accounting policy in accordance with the Accounting Act. The audit of
the correctness of the preparation of periodic financial statements is conducted thanks to the
annual financial audits carried out by independent auditors.
In the reporting period, the financial report was prepared by a professional entity – the auditing
firm „Galex”, which provided accounting services for the Company on the basis of an outsourcing
agreement. By using the services of a specialized office, the Management Board received ongoing
external advice on consulting all problems related to the correct preparation of mandatory
financial statements, including quarterly, semi-annual and annual financial statements.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
18
V. REMUNERATION REPORT
This remuneration report has been prepared in accordance with the remuneration principles of the
Company’s Management Board member. The member of the Management Board is remunerated
pursuant to the signed contract. The remuneration report discloses the remuneration and benefits
paid to the member of the Management Board in the financial year 2022/2023.
The Management Board of the Company consist of one member - Damian Patrowicz. The contract
of Damian Patrowicz, a member of the Management Board, was signed on 18/06/2021 and his
term of office is valid until 18/06/2024.
Management Board Members are selected by the Supervisory Board of the Company based on
their expertise in the sector the Company is operating, in addition, the candidate’s leadership and
management experience is taken into account as well as the commitment to the Company. The
Management Board member is not paid any remuneration. No share options are issued to the
management.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
19
VI. FINANCIAL STATEMENTS
1. Statement of financial position
STATEMENT OF FINANCIAL POSITION
Note
30/06/2023
(in thous. EUR)
30/06/2022
(in thous. EUR)
A s s e t s
Fixed assets
1 365
4 365
Long-term financial assets
4
1 365
4 365
Current assets
3 636
463
Short-term financial assets
4
3 634
461
Short-term accruals
2
2
T o t a l a s s e t s
5 001
4 828
E q u i ty
Share capital
5
10 511
10 511
Share premium
409
409
Other reserves
56
56
Exchange differences
-345
-377
Retained earnings
-5 635
-5 777
T o t a l e q u i t y
4 996
4 822
L i a b i l i t i e s
Short-term liabilities
5
6
Trade liabilities
0
1
Other provisions
5
5
T o t a l l i a b i l i t i e s
5
6
T o t a l l i a b i l i t i e s a n d e q u i ty
5 001
4 828
Book value of equity
4 996
4 822
Number of shares
6
105 111 804
105 111 804
Book value per one share (in EUR)
6
0,05
0,05
Notes on pages 23-42 are an integral part of the financial statements.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
20
2. Statement of profit or loss
STATEMENT OF PROFIT OR LOSS
Note
Period
01/07/2022 –
30/06/2023
(in thous. EUR)
Period
01/07/2021 –
30/06/2022
(in thous. EUR)
Revenue from interest
7
158
143
Gross profit (loss) on sales
158
143
General management costs
-19
-14
Profit (loss) on operating activities
139
129
Financial income
7
0
Financial costs
-4
0
Profit (loss) before income tax
142
129
Profit (loss) for the period
142
129
Number of ordinary shares
105 111 804
105 111 804
Profit (loss) per one ordinary share (in EUR)
0,001
0,001
Notes on pages 23-42 are an integral part of the financial statements.
3. Statement of comprehensive income
STATEMENT OF COMPREHENSIVE INCOME
Period
01/07/2022 –
30/06/2023
(in thous. EUR)
Period
01/07/2021 –
30/06/2022
(in thous. EUR)
Profit (loss) for the period
142
129
Other comprehensive income (loss), including:
32
-47
Exchange differences
32
-47
Total comprehensive income (loss) for the period
174
82
Basic earnings per share (in EUR)
0,001
0,001
Diluted earnings per share (in EUR)
0,001
0,001
Notes on pages 23-42 are an integral part of the financial statements.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
21
4. Statement of changes in equity
STATEMENT OF CHANGES IN EQUITY
30/06/2023
(in thous. EUR)
30/06/2022
(in thous. EUR)
Opening balance of equity
4 822
4 740
Opening balance of share capital
10 511
500
changes in share capital
0
10 011
a) increases due to bonus issue
0
10 011
Closing balance of share capital
10 511
10 511
Opening balance of share premium
409
10 420
changes in share premium
0
-10 011
a) decreases due to share capital increase
0
-10 011
Closing balance of share premium
409
409
Opening balance of other reserves
56
56
Closing balance of other reserves
56
56
Opening balance of Retained earnings
-5 777
-5 906
increase / decrease due to profit/loss for the period
142
129
Closing balance of Retained earnings
-5 635
-5 777
Opening balance of exchange differences
-377
-330
changes of exchange differences
32
-47
Closing balance of exchange differences
-345
-377
Closing balance of equity
4 996
4 822
Notes on pages 23-42 are an integral part of the financial statements.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
22
5. Cash flow statement
CASH FLOW STATEMENT
(indirect method)
Note
Period
01/07/2022 –
30/06/2023
(in thous.
EUR)
Period
01/07/2021 –
30/06/2022
(in thous.
EUR)
Operating activities
Profit (loss) for the period
142
129
Adjustments:
-142
-134
Difference between interest calculated and received
-53
-109
Loans granted
8
-1 952
-90
Repayments received
8
1 842
64
Changes in receivables
0
2
Change in liabilities
-1
-1
Net cash flows (outflows) from operating activities
0
-5
Exchange differences
22
0
Net cash flows (outflows) total
0
-5
Change in cash balances
0
-5
Cash balance at the beginning of the period
0
5
Cash balance at the end of the period
0
0
Notes on pages 23-42 are an integral part of the financial statements.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
23
NOTES TO THE FINANCIAL STATEMENTS
Note 1. Accounting policies
1.1. General information
Investment Friends Capital SE (hereinafter referred to as the “Company” or “Investment Friends
Capital”) a company based on Polish capital operates in Estonia and Poland.
The financial statements of the Company for 2022/2023 were signed by the member of
management Board of Investment Friends Capital SE on 28 September 2023.
In accordance with the requirements of the Commercial Code of the Republic of Estonia, the
annual report prepared by the Management Board and approved by the Supervisory Board, which
also includes the financial statements, is approved by the general meeting of shareholders.
Shareholders have the right not to approve the annual report prepared by the Management Board
and approved by the Supervisory Board and to request that a new report is prepared. The Annual
General Meeting of Shareholders, one of the items on the agenda of which is the approval of the
annual report of Investment Friends Capital SE for 2022/2023, is planned on 30/11/2023.
1.2. Basis of preparation of financial statements
The Company’s 2022/2023 annual financial statements have been prepared in conformity of
International Financial Reporting Standards as endorsed in the European Union (“IFRS (EU)”).
The Company has consistently applied the accounting policies throughout all periods presented,
unless stated otherwise.
The annual financial statements for 2022/2023 have been prepared on a going concern basis.
The preparation of annual financial statements in conformity with IFRS (EU) requires the use of
certain critical accounting estimates. It also requires management to exercise its judgment in the
process of applying the Company’s accounting policies. Changes in assumptions may have a
significant impact on the financial statements in the period the assumptions changed. The
management of the Company believes the underlying assumptions in the preparation of annual
financial statements for 2022/2023 are appropriate.
These annual financial statements consist of statements of financial position, statement of profit or
loss, statement of comprehensive income, statement of changes in equity, statement of cash flows,
and explanatory notes.
The annual financial statements are presented in euros and all values are rounded to the nearest
thousand (€000), except when otherwise indicated.
The original annual financial statements of the Company have been prepared is English. In case of
the conflict with Polish or Estonian translation, the English version shall prevail.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
24
1.3. Functional and reporting currency
The functional currency of the Company is Polish zloty (PLN) and reporting (presentational)
currency is euro (EUR).
Balance sheet items are calculated according to the exchange rate announced by the European
Central Bank as at the balance sheet day.
Items in the statement of profit or loss and in the cash flow statement are converted at the
exchange rate being the arithmetic average exchange rate published by the European Central Bank
for the financial year.
1.4. Accounting policies, changes in accounting estimates and errors (IAS 8)
When an IFRS (EU) specifically applies to a transaction, other event, or condition, the accounting
policy or policies applied to that item shall be determined by applying the IFRS (EU). In the
absence of an IFRS (EU) that specifically applies to a transaction, other event or condition,
management shall use its judgement in developing and applying an accounting policy that results
in information that is relevant to the economic decision-making needs of users and reliable.
The Company selects and applies its accounting policies consistently for similar transactions,
other events, and conditions, unless an IFRS (EU) specifically requires or permits categorization
of items for which different policies may be appropriate. If an IFRS (EU) requires or permits such
categorization, an appropriate accounting policy shall be selected and applied consistently to each
category.
The Company changes an accounting policy only if the change is required by IFRS (EU) or results
in the financial statements providing reliable and more relevant information about the effects of
transactions, other events, or conditions on the entity’s financial position, financial performance or
cash flows. When a change in accounting policy is applied retrospectively the Company adjusts
the opening balance of each affected component of equity for the earliest prior period presented
and the other comparative amounts disclosed for each prior period presented as if the new
accounting policy had always been applied.
The effect of a change in an accounting estimate shall be recognized prospectively by including it
in profit or loss in the period of the change, if the change affect that period only or the period of
the change and future periods, if the change affects both.
The Company corrects material prior period errors retrospectively in the first set of financial
statements authorized for issue at their discovery by restating the comparative amounts for the
prior period(s) presented in which the error occurred; or if the error occurred before the earliest
prior period presented, restating the opening balances of assets, liabilities and equity for the
earliest prior period presented.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
25
1.5. Impact of new and revised standards and interpretations
The accounting policies applied in the preparation of these financial statements are the same as
those used by the Company in the financial statements for the year ended 30 June 2023.
Revised standards effective for annual reporting periods beginning on or after 1 January 2023.
Certain new or revised standards and interpretations have been issued that are mandatory for the
Company’s annual reporting periods beginning on or after 1 January 2023 and that have not been
adopted by the Company ahead of effective date.
Amendments to IAS 1 „Presentation of Financial Statements“ and IFRS Practise Statement 2
„Making Materiality Judgments“- amendments aim to help entities provide accounting policy
disclosures that are more useful by:
requiring companies to disclose their material accounting policies rather than their
significant accounting policies;
clarifying that accounting policies related to immaterial transactions, other events or
conditions are themselves immaterial and as such need not be disclosed; and
clarifying that not all accounting policies that relate to material transactions, other events
or conditions are themselves material to a company’s financial statements.
The Board of IFRS also amended IFRS Practice Statement 2 to include guidance and two
additional examples on the application of materiality to accounting policy disclosures.
The amendments are consistent with the refined definition of material: “Accounting policy
information is material if, when considered together with other information included in an entity’s
financial statements, it can reasonably be expected to influence decisions that the primary users of
general purpose financial statements make on the basis of those financial statements”.
Effective for annual reporting periods beginning on or after 1 January 2023. The EU has approved
the changes.
The Company does not expect the amendments to have a material impact on its financial
statements when initially applied.
Amendments to IAS 1 „Presentation of Financial Statements“ (classification of liabilities as
current and non-current) – amendments are aimed to promote consistency in applying the
requirements by helping the companies determine whether liabilities and other liabilities with
uncertain settlement dates should be classified as current (to be settled within 12 months) or non-
current. The amendments clarify what is meant by the right to defer settlement; that a right to
deferral must exist at the end of the reporting period; that classification is unaffected by the
likelihood that an entity will exercise its deferral right and that only if the embedded derivative in
a convertible liability is itself an equity instrument would the terms of a liability not impact its
classification.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
26
Effective for annual reporting periods beginning on or after 1 January 2023. The EU has approved
the changes.
The Company does not expect the amendments to have a material impact on its financial
statements when initially applied.
Amendments to IAS 8 „Accounting Policies, Changes in accounting Estimates and Errors“ –
amendments introduce a new definition for accounting estimates. According to the new definition,
accounting estimates are "monetary amounts in financial statements that are subject to
measurement uncertainty". Entities should develop accounting estimates when the accounting
policies require the measurement of items in the financial statements that are subject to
measurement uncertainty. The amendments clarify that a change in an accounting estimate
resulting from new information or new developments is not a correction of an error. Effective for
annual reporting periods beginning on or after 1 January 2023. The EU has approved the changes.
The Company does not expect the amendments to have a material impact on its financial
statements when initially applied.
Other changes
Other new standards, amendments to standards and interpretations that are not yet effective are not
expected to have a significant impact on the Company’s financial statements.
Changes in standards
Annual Improvements to IFRS Standards 2018–2020 (the Company will apply the amendment for
annual periods beginning on or after 1 January 2022). Not yet endorsed for use in the EU.
IFRS 9 - Amendments clarify which fees to consider when assessing whether or not the terms of a
converted debt Instrument have changed - only fees paid or received between the borrower and the
lender (including payments made or received by the borrower or lender on behalf of another party).
The Company does not expect the amendments to have a material impact on its financial
statements when initially applied.
Other new standards, amendments to standards and interpretations that are not yet effective are not
expected to have a significant impact on the Company’s financial statements.
Annual improvements to IFRS standards 2018-2020 – Effective for annual periods beginning
on or after 1 January 2022. Early application is permitted.
Improvements to IFRS (2018-2020) include two amendments to the standards:
the amendments to IFRS 9 Financial instruments clarify that, when assessing whether an
exchange of debt instruments between an existing borrower and lender is on terms that are
substantially different, the fees to include together with the discounted present value of the cash
flows under the new terms include only fees paid or received between the borrower and the lender,
including fees paid or received by either the borrower or lender on the other's behalf.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
27
The Company does not expect the amendments to have a material impact on its financial
statements when initially applied.
Other changes
Other new standards, amendments to standards and interpretations that are not yet effective are not
expected to have a significant impact on the Company’s financial statements.
1.6. Financial assets (IFRS 9, IAS 32)
Classification
The Company classifies financial assets into the following measurement categories:
• those at fair value (either through other comprehensive income or through profit or loss);
• those carried at amortised cost.
The classification depends on the Company's business model for managing its financial assets and
the contractual terms of the cash flows.
Registration and derecognition
Purchases and sales of financial assets under normal market conditions are recognized on the trade
date, the date on which the Company commits to purchase or sell the asset. Financial assets are
derecognised when the rights to receive cash flows from the asset have expired or have been
transferred and the Company has transferred substantially all risks and rewards of ownership.
Measurement
Financial assets (unless they are receivables from a buyer that does not have a significant
financing component and are initially measured at transaction price) are initially measured at fair
value and in the case of assets not measures at fair value through profit or loss, related acquisition
costs of assets are added to the initial value.
Debt instruments
Subsequent recognition of debt instruments depends on the Company's business model for
managing its financial assets and the contractual cash flows of the financial assets. Assets held for
the purpose of collecting contractual cash flows that have only cash flows and interest payable are
recognised at amortised cost using the effective interest rate method. Impairment losses are
deducted from the adjusted acquisition cost. Interest income, foreign exchange gains and losses
and impairment losses are recognised in the income statement.
Gains or losses on derecognition are recognised in the income statement under “Other operating
income / expense”. As of 30 June 2022 and 30 June 2023 and during 2022/2023, financial assets
of the Company were classified as at amortised cost.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
28
Impairment of financial assets
The impairment loss model is applied to financial assets at amortized cost. Financial assets carried
at amortized cost consist of loan receivables, other receivables, cash and cash equivalents.
Expected credit losses are probability-weighted estimated credit losses. Credit loss is the
difference between the contractual cash flows of the Company and the expected cash flows of the
Company, discounted at the original effective interest rate.
Measurement of expected credit loss takes into account: (i) an unbiased and probabilistic amount
that estimates a number of different outcomes, (ii) the time value of money and (iii) reasonable
and reasonable information available at the end of the reporting period conditions and forecasts of
future economic conditions.
The Company measures impairment as follows:
cash and cash equivalents at low credit risk (senior management considers a low credit risk
assessment of at least one of the major credit rating agencies) to be equivalent to expected
credit losses within 12 months;
for all other financial assets, the amount of credit losses expected to be incurred over a 12-
month period, unless the credit risk (i.e. the expected life of the financial asset in default)
has increased significantly after initial recognition; if the risk is significantly increased, the
credit loss is measured at an amount equal to the expected credit loss over a lifetime.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that
are not quoted in an active market. Loans and receivables are initially recognised at their fair value
plus transaction costs. After initial recognition, loans and receivables are carried at amortised cost
using the effective interest rate method. This method is used to calculate interest income on the
receivable in subsequent periods. Financial assets are adjusted for impairment losses.
Impairment is based on expected credit loss. The principle of expected credit loss is to show the
overall trend in the deterioration or improvement in the credit quality of a financial asset.
Impairment losses on financial assets classified at amortised cost are recognised as a provision for
impairment.
Expected credit losses are probability-weighted estimated credit losses that, at the reporting date,
consider all relevant information, including information about past events, current conditions,
reasonable and reasonable future events, and forecasts of economic conditions. At the end of each
reporting period, the Company conducts a review to determine whether there has been a material
increase in risk compared to the last estimate. Indicators of increased credit risk include, but are
not limited to, overdue payments over 30 days, significant financial difficulties of the debtor,
possible bankruptcy or restructuring of the debtor. Impairment charges are recognised in the
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
29
income statement under “Other operating expenses”. If receivables are uncollectible, they are
written off together with a provision for impairment.
Receivables are generally recognised as current assets when they are due to be settled within 12
months after the balance sheet date. Receivables that are due later than 12 months after the balance
sheet date are recognised as non-current assets. Financial assets that do not include SPPI (Solely
Payment of Principal and Interest) cash flows are recognised at fair value through profit or loss.
Financial assets
30.06.2023
Classes of financial instruments
(in thous.EUR)
Fair value
through
profit or
loss
Amortised
cost
Total
Total financial assets
0
5 001
5 001
Granted loans
0
4 999
4 999
Short-term accruals
0
2
2
30.06.2022
Classes of financial instruments
(in thous.EUR)
Fair value
through
profit or
loss
Amortised
cost
Total
Total financial assets
0
4 828
4 828
Granted loans
0
4 826
4 826
Short-term accruals
0
2
2
Professional judgment
If a given transaction is not regulated by any standard or interpretation, the Management Board,
guided by its subjective judgment, determines and applies accounting policies which will ensure
that the financial statements will contain correct and reliable information and:
correctly, clearly and fairly present the assets and financial situation of the Company, the
results of its activities and cash flows,
reflect the economic content of the transaction,
are objective,
is prepared in accordance with the principle of prudent valuation,
is complete in all material respects.
When valuating the loans, the debtor's solvency is taken into account. We take into account the
risk of non-repayment. If there is no risk of repayment, we value the loans at their nominal value.
There are conducted proper analysis.
The Management Board makes decisions considering all the potential consequences of its
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
30
decisions. Hence, the decision-making process is based on multi-stage analysis of, inter alia,
borrowers' collaterals.
Uncertainty of estimates
When applying the accounting principles in force in the Company, the Management Board is
obliged to make estimates, judgments and assumptions regarding the amounts of valuation of
individual assets and liabilities. The estimates and related assumptions are based on historical
experience and other factors considered relevant. The actual results may differ from the adopted
estimated values. The preparation of the financial statements requires the Management Board of
the Company to make estimates, as much of the information contained in the financial statements
cannot be accurately valued. The Management Board verifies the adopted estimates based on
changes in the factors considered when making them, new information or past experiences.
Therefore, the estimates made as at June 30, 2023 may be changed in the future.
1.7. Cash and cash equivalents, cash flows (IAS 7)
Cash and cash equivalents are cash at bank and on hand, short-term extremely high liquidity
investments (up to three months) that are readily convertible into a known amount of cash and
which are subject to an insignificant risk of changes in value.
The statement of cash flows reports cash flows during the period classified by operating, investing
and financing activities. The Company reports cash flows from operating activities using the
indirect method whereby net profit or loss is adjusted for the effects of transactions of a non-cash
nature, any deferrals or accruals of past or future operating cash receipts or payments, and items of
income or expense associated with investing or financing cash flows.
1.8. Share Capital (IAS 1)
Ordinary shares are included within equity. The expenditures related to the issue of ordinary
shares are recognised as a reduction of equity. Treasury shares repurchased by the parent company
are recognised as a reduction of equity (in the line item “Treasury shares”). Disbursements and
contributions related to treasury shares are recognised in equity.
1.9. Share premium (IAS 1)
The differences between the fair value of the payment received and the nominal value of shares
are recognized in the share premium. In the event of buyout of shares, the amount paid for the
shares is charged to equity and is disclosed in the statement of financial position under equity.
The costs of issuing shares, incurred when establishing a joint-stock company or increasing the
share capital, reduce the entity's supplementary capital to the amount of the excess of the issue
value over the par value of the shares, and the remaining part is classified as financial costs.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
31
1.10. Statutory reserve capital (IAS 1)
Reserve capital is formed to comply with the requirements of the Commercial Code of the
Republic of Estonia. During each financial year, at least 5% of the net profit shall be transferred to
reserve capital until reserve capital reaches one-tenth of share capital. Reserve capital may be used
to cover a loss or to increase share capital. Payments shall not be made to shareholders from
reserve capital. In the statement of financial position statutory reserve is recognised in the Other
reserves.
1.11. Earnings per share (IAS 33)
Basic earnings per share is calculated by dividing the profit for the year attributable to ordinary
equity holders of the Company by the weighted average number of shares outstanding during the
year. Diluted earnings per share is calculated by dividing the profit attributable to equity holders
of the Company (after adjusting for interest on the convertible preference shares) by the weighted
average number of shares outstanding during the year plus the weighted average number of shares
that would be issued on conversion of all the dilutive potential shares into shares.
1.12. Financial liabilities (IFRS 9, IAS 32)
All financial liabilities (trade payables, other short and long-term liabilities, borrowings, etc.) are
initially recognised at their fair value, less any transaction costs. They are subsequently recognised
at amortised cost, using the effective interest rate method.
The amortised cost of the current financial liabilities generally equals their nominal value;
therefore current financial liabilities are stated in the statement of financial position at redemption
value. To calculate the amortised cost of non- current financial liabilities, they are initially
recognised at fair value of the proceeds received (net of transaction costs incurred) and an interest
expense is calculated on the liability in subsequent periods using the effective interest rate method.
A financial liability is classified as current when it is due to be settled within 12 months after the
balance sheet date or the Company does not have an unconditional right to defer settlement of the
liability for at least 12 months after the balance sheet date. Interest-bearing liabilities that are due
within 12 months after the balance sheet date, but which are refinanced after the balance sheet date
as long-term, are recognised as short-term interest-bearing liabilities. Also, borrowings are
classified as short-term if the lender had at the balance sheet date the contractual right to demand
immediate payment of the borrowing due to the breach of conditions set forth in the agreement.
1.13. Provisions and contingent liabilities (IAS 37)
Provisions are recognized when the Company has a present obligation (legal or constructive)
because of a past event it is probable that the Company will be required to settle the obligation,
and a reliable estimate can be made of the amount of the obligation.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
32
The amount recognized as a provision is the best estimate of the consideration required to settle
the present obligation at the end of the reporting period, considering the risks and uncertainties
surrounding the obligation. When a provision is measured using the cash flows estimated to settle
the present obligation, its carrying amount is the present value of those cash flows (when the effect
of the time value of money is material).
When some or all the economic benefits required to settle a provision are expected to be recovered
from a third party, a receivable is recognized as an asset if it is virtually certain that
reimbursement will be received.
Contingent liabilities
Contingent liabilities are those liabilities the realization of which is less probable than non-
realization or the amount of which cannot be measured sufficiently reliably. The Company does
not recognize contingent liabilities but discloses brief description of the nature of the contingent
liability and, where practicable an estimate of its financial effect; an indication of the uncertainties
relating to the amount or timing of any outflow; and the possibility of any reimbursement unless
the possibility of any outflow in settlement is remote.
1.14. Revenue recognition (IFRS 15)
Interest income
Interest income is recognized when it is probable that the economic benefits associated with the
transaction will flow to the Company and the amount of the revenue can be measured reliably.
Interest income is recognized on an accrual basis.
1.15. Operating segments (IFRS 15, IFRS 8)
A segment is a distinguishable component of the Company, which generates revenues and incurs
expenditures. The segment reporting is presented in respect of operating and geographical
segments. The Company operates in only one business area, therefore the segment reporting is not
relevant.
1.16. Income tax (IAS 12)
Corporate income tax in Estonia
According to the Income Tax Act entered into force in Estonia at 1 January 2000, it is not the
company's profits that are taxed but net dividends paid. Income tax is paid on dividends, fringe
benefits, gifts, donations, costs of reception of guests, non-business payments and transfer price
adjustments. The effective income tax rate is 20/80 on net dividends paid out. Starting from 2019,
it is possible to apply a more favorable tax rate on dividend payments (14/86). The more favorable
tax rate can be applied to a dividend distribution that amounts to up to three preceding years’
average dividend distribution that has been taxed at 20/80 rate.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
33
1.17. Related parties (IAS 24)
A related party is a person or entity that is related to the entity that is preparing its financial
statements. A related party transaction is a transfer of resources, services, or obligations between a
reporting entity and a related party, regardless of whether a price is charged. Such transactions
could have an effect on the profit or loss and financial position of the Company. For this reason,
knowledge of the Company’s transactions, outstanding balances, including commitments, and
relationships with related parties may affect assessments of its operations by users of financial
statements, including assessments of the risks and opportunities facing the Company.
The Company discloses the related party relationship when control exists, irrespective of whether
there have been transactions between the related parties.
The Company considers key members of the management (supervisory and management board),
their close relatives and entities under their control or significant influence as well as associated
companies as related parties.
1.18. Events after the reporting period (IAS 10)
Events after the reporting period are those events, favorable and unfavorable, that occur between
the end of the reporting period and the date when the financial statements are authorized for issue.
Events after the reporting period are those that provide evidence of conditions that existed at the
end of the reporting period (adjusting events after the reporting period) and those that are
indicative of conditions that arose after the reporting period (non-adjusting events after the
reporting period).
Note. 2. Financial risks
The main types of risk arising from the Company's financial instruments include interest rate risk,
liquidity risk, credit risk. The Management Board is responsible for establishing of the risk
management rules and supervising of its respecting. The principles of risk management aim is to
identify and analyse the risks that the Company is exposed to, by establishing appropriate limits
and controls.
Liquidity risk
As any entity operating on the market, the Company is exposed to the risk of losing financial
liquidity, which indicates the Company’s ability to meet its obligations within the specified term.
Financing from external sources (debt instruments, loans) increases the risk of losing liquidity in
the future. The Company’s current liquidity risk is low. However, one can not exclude the risk of
disturbance or even loss of liquidity due to missed investments and repricing capital or lack of
repayment of loans granted and enforcement difficulties as well as non- compliance of obligations
by contractors. The company does not exclude financing investments with debt instruments or
target issuance of shares in the future (if necessary). The Company manages its liquidity through
ongoing monitoring of the level of due liabilities, cash flows and proper cash management.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
34
Credit risk
(a) Credit risk assessment - credit risk represents a potential loss that could arise if a Company’s
counterparty in a transaction is unable to meet its contractual obligations and provide cash flows.
Credit risk is mainly related to loans granted by the Company, cash and cash equivalents, deposits.
The scope of the Company's credit risk is most affected by the specific circumstances of each
customer. At the same time, the Company's management also follows the general circumstances
such as the legal status of the client (private or public company), the geographical location of the
client, the field of operation, the state of the economy and future economic forecasts. To reduce
the credit risk, customers' payment discipline and their ability to meet their commitments are
monitored daily.
(b) Credit quality of financial assets - the Company uses a simplified approach to measure
expected credit losses under IFRS 9, applying lifetime expected credit losses. Historical loss rates
are adjusted to include both current and future information about the macroeconomic factors,
which may have impact on the ability of customers to pay the receivables. Based on the principles
described above, as of 30 June 2023, the impact of impairment losses on the Company’s cash
flows was immaterial.
The maturity dates of the assets as at 30/06/2023
30/06/2023
in thous.EUR
Maturity dates
Total
< 1 year
1-2 years
2-3 years
Above 3
years
Short-term
accruals
2
2
0
0
0
Loans granted
4 999
3 634
1 365
0
0
Total
5 001
3 636
1 365
0
0
The maturity dates of the assets as at 30/06/2022
30/06/2022
in thous.EUR
Maturity dates
Total
< 1 year
1-2 years
2-3 years
Above 3
years
Short-term
accruals
2
2
0
0
0
Loans granted
4 826
461
917
3 448
0
Total
4 828
463
917
3 448
0
Entities to which the Company provides financing are related entities, therefore there is no
particular type of control. Related entities received loans to invest in the capital market or grant
further loans. The primary borrower's strategy is conservative, which means that the borrower
invests the borrowed money in profitable companies. The loans are to be repaid, among other
things, from received dividends in the borrower's portfolio.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
35
Interest rate risk
At the balance sheet date, the interest rate structure of the Company’s interest-bearing financial
instruments were as follows:
Interest rate
Fixed/Variable interest rate
Damar Patro UÜ
2% ; 2,5% and 4%
Fixed
Patro Administracja Sp. z o.o.
8%
Fixed
Natural person
24,50 %
Fixed
The Company has no significant interest-bearing liabilities. The Company's income and operating
cash flows are substantially independent of changes in market interest rates, because contracts are
concluded at fixed interest rates. The level of interest rates in the last 12 months in Eurozone
increased from 0,5% to 4,25%. The level of interest rates in Poland remained above 6% in the last
financial year. Dynamic increases in interest rates were also observed in the USA. This activity
was related to high inflation and pressure to reduce it.
Risk related to the shareholding structure
As at the date of the report (30/06/2023) 71,24% share capital and 71,24% votes at the Company’s
General Meeting belong directly to Patro Invest OÜ, as a result of which the above Shareholder
has a significant impact on the resolutions adopted at the Company’s General Meeting.
Risk related to the economic situation in Poland and Estonia
The economic situation in Poland and Estonia have a significant impact on the financial results
achieved by all entities operating in these countries, including the Company, because the success
of the development of companies investing in financial instruments and conducting financial
service activities largely depends, inter alia, on the conditions of conducting business activity.
Rising inflation may also have an impact on the business situation as it may have an impact on the
level of interest rates.
Risk related to related parties
There are interpretations indicating the possibility of risk arising from the negative impact of links
between members of the Company's management or control bodies on their decisions. This applies
in particular to the impact of these ties in the scope of ongoing supervision over the Company's
operations. When assessing the likelihood of such risk, it should be considered that the
supervisory bodies are subject to the control of another body - the General Meeting, and it is in the
interest of the members of the Supervisory Board to perform their duties in a reliable and lawful
manner.
Currency risk
There is a currency risk in connection with the loans granted in PLN. The risk related to the
possibility of fluctuations in the exchange rate of one currency in relation to another may lead to
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
36
both deterioration of the financial situation of the entity and its improvement as a result of a
decrease in a given receivable or an increase in this receivable. Financial assets and liabilities
recognized in euros and polish zlotys did not carry considerable risk. In the last financial year, a
strong strengthening of PLN was noticeable both against EUR (+5,9%, from 4,44 into 4,70) and
USD (+10%, from 4,07 into 4,49).
Risk related to the armed conflict in Ukraine.
Due to the ongoing armed conflict in Ukraine, the Company's operations are moderately exposed
to the consequences of the war. As at the date of publication of the report, the Company does not
anticipate extending the conflict beyond the territory of Ukraine therefore, no impact on the
operating activities of the Company is expected.
MANAGEMENT JUDGEMENTS
As at the day of preparation of the annual report, the Management Board according to their best
knowledge, does not recognize any threat in terms of fulfilling his obligations and financial
liquidity. The Company settles its liabilities systematically and has not taken any credits or loans
taken or other significant obligations. The Company dedicates its financial resources for
conducted lending activity and intends to develop this activity gradually. Possible surpluses are
located on temporary deposits in safe banks. Because of the fact that the main activity of the
Company is the granting of loans, the proper and prompt fulfillment of the contractual obligations
of the borrowers has a significant impact on the Company's results and maintaining.
Note 3. Capital Management
The policy of the Management Board is to maintain a solid capital base in order to maintain
investors confidence and to ensure the future development of economic activity. The Company
manages its capital to maintain the ability to continue operations, taking into account the
implementation of planned investments, so that it can generate returns for shareholders. In line
with market practice, the Company monitors capital, among others, on the basis of the equity ratio
and the ratio of credits, loans and other sources of financing / EBITDA. In order to maintain
financial liquidity and creditworthiness allowing for obtaining external financing at a reasonable
level of costs, the Company assumes maintaining the equity ratio at a level not lower than 0.5,
while the ratio of loans, borrowings and other sources of financing / EBITDA at a level of up to
2.0
30/06/2023
(in thous.EUR)
30/06/2022
(in thous.EUR)
Equity
4 996
4 822
Net asset value
4 996
4 822
Total assets
5 001
4 828
Total liabilities
5
6
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
37
Equity ratio*
0,99
0,99
Debt to capital ratio**
0,001
0,001
Profit (loss) on operating activities
139
129
EBITDA***
139
129
*Equity ratio = equity / total assets
** Debt to capital ratio = total liabilities / total assets
***EBITDA = Profit (loss) on operating activities + deprecation
Note 4 Financial assets
Borrower
During 12
months (in
thous. EUR)
1-5 years (in
thous. EUR)
Interest rate
Currency
of the loan
granted
Deadline
Collateral
Natural person*
7
0
24,50%
PLN
31.03.2016
Notarial deed
on voluntary
submission to
enforcement,
blank
promissory
note, mortgage
on real estate
Damar Patro
UÜ
3 627
0
2,5%
EUR
30.06.2024
Blank
promissory note
Damar Patro
UÜ
0
470
4%
EUR
30.06.2025
Blank
promissory note
Damar Patro
UÜ
0
669
2%
EUR
31.12.2024
Blank
promissory note
Patro
Administracja
Sp. z o.o.
0
226
8%
PLN
31.12.2024
Blank
promissory note
Total
3 634
1 365
* The company released a write-down for a loan granted to a natural person in the amount of EUR 7 thous.
(= PLN 33 thous.).
Receivables from loans and interest from related entities are presented in note 9.
30.06.2022
Borrower
During 12
months (in
thous. EUR)
1-5 years (in
thous. EUR)
Interest
rate
Currency of
the loan
granted
Deadline
Collateral
Natural person*
3
0
10%
PLN
31.03.2016
Notarial deed on
voluntary
submission to
enforcement,
blank promissory
note, mortgage
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
38
on real estate
Natural person
316
0
10%
PLN
23.04.2016
Notarial deed on
voluntary
submission to
enforcement,
blank promissory
note, mortgage
Damar Patro
UÜ
142
3 400
2,5%
EUR
31.12.2024
Blank promissory
note
Damar Patro
UÜ
0
48
8%
PLN
31.12.2024
Blank promissory
note
Patro
Administracja
Sp. z o.o.
0
897
2,7%
PLN
31.12.2023
Blank promissory
note
Patro Invest OÜ
0
20
2,7%
PLN
31.12.2023
Blank promissory
note
Total
461
4 365
* The Company made a write-down on a loan granted to a natural person for the amount of EUR 7 thous.
(PLN 33 thous.).
Note 5 Share capital and shareholding structure
SHARE CAPITAL
30/06/2023
(thous.EUR)
30/06/2022
(thous.EUR)
Opening balance of share capital
10 511
500
Increase due to bonus issue
0
10 011
Closing balance of share capital
10 511
10 511
In previous financial year the share capital of the Company was increased by way of a bonus issue
of shares by increasing the share capital by EUR 10 010 648 at the expense of the share premium,
which was reduced about EUR 10 010 648. The number of shares was increased from 5 005 324
into 105 111 804.
Share capital as at
30/06/2023
Type of shares
Number of shares
Share capital
Bearer shares
105 111 804
10 511 180 euro
TOTAL
105 111 804
10 511 180 euro
As at the balance sheet date 30/06/2023, the Company’s equity is less than 50% of the share
capital and does not comply with the requirements of § 301 of the Commercial Code of Estonia.
The Management Board of Investment Friends Capital SE will propose to the general meeting to
reduce the share capital of the Company. The Company has convened a general meeting on
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
39
October 6, 2023, during which the share capital will be reduced towards the share premium. Thus,
the requirement set out in § 301 of the Commercial Code of Estonia will be met.
To the best knowledge of the Management Board, as at the balance sheet date, i.e. 30/06/2023 the
structure of direct and indirect shareholders holding at least 5% of the total number of votes at the
General Meeting was as follows:
Structure of direct shareholding as at 30/06/2023
No.
Direct shareholders
Number of
shares
% of shares
Number of votes
% of votes
1.
Patro Invest OÜ
74 878 260
71,24
74 878 260
71,24
X
Total
105 111 804
100,00
105 111 804
100,00
Structure of indirect shareholding as at 30/06/2023
No.
Indirect shareholders
Number of
shares
% of shares
Number of votes
% of votes
1.
Damian Patrowicz*
74 878 260
71,24
74 878 260
71,24
* Damian Patrowicz owns 100% of Patro Invest OU
To the best knowledge of the Management Board, as at the balance sheet date, i.e. 30/06/2022 the
structure of direct and indirect shareholders holding at least 5% of the total number of votes at the
General Meeting was as follows:
Structure of direct shareholding as at 30/06/2022
No.
Direct shareholders
Number of
shares
% of shares
Number of votes
% of votes
1.
Patro Invest OÜ
74 878 260
71,24
74 878 260
71,24
X
Total
105 111 804
100,00
105 111 804
100,00
Structure of indirect shareholding as at 30/06/2022
No.
Indirect shareholders
Number of
shares
% of shares
Number of votes
% of votes
1.
Damian Patrowicz*
74 878 260
71,24
74 878 260
71,24
* Damian Patrowicz owns 100% of Patro Invest OU
Note 6 Book value per share
As at
30/06/2023
As at
30/06/2022
Book value of equity (in
thous.EUR)
4 996
4 822
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
40
Number of shares (pcs)
105 111 804
105 111 804
Book value per one share (in
EUR)
0,05
0,05
Basic earnings per share (in EUR)
0,001
0,001
Diluted earnings per share (in
EUR)
0,001
0,001
Note 7 Revenue from interest
REVENUE FROM INTEREST
01/07/2022 –
30/06/2023
(in thous.EUR)
01/07/2021 –
30/06/2022
(in thous.EUR)
Total revenues from interest
158
143
- including: from related entities
113
109
Sales to related entities are described in the note 9.
Revenue by geographical regions (location of customer):
GEOGRAPHICAL AREA FOR FINANCIAL ACTIVITIES
01/07/2022 –
30/06/2023
(in thous.EUR)
01/07/2021 –
30/06/2022
(in thous.EUR)
Estonia
101
85
Poland
57
58
Total
158
143
Information on leading customers:
For the year 2022/2023:
In the period 01/07/2022 - 30/06/2023 the Company achieved revenue from transactions with a
single client over 10% of the total revenue of the entity:
Client no. 1 – 61,73 % of total revenues
Client no. 2 – 27,25 % of total revenues
For the year 2021/2022:
In the period 01/07/2021 - 30/06/2022 the Company achieved revenue from transactions with a
single client over 10% of the total revenue of the entity:
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
41
Client no. 1 – 59,55 % of total revenues
Client no. 2 – 22,77 % of total revenues
Client no. 3 – 16,66 % of total revenues
Note 8 Explanatory note to the Cash Flow Statement
In the financial year 2022/2023 the Company granted two loans to Patro Administracja Sp. z o. o.,
two loans to Damar Patro UǕ and one loan to Patro Invest OÜ. The total amount of loans granted
in the financial year is EUR 1 952 thous. (in 2021/2022: EUR 90 thous.). The principal of the loan
was repaid by natural persons, Patro Invest OǕ, Patro Administracja Sp. z o. o. and Damar Patro
UǕ. The total amount of principal repayments received is EUR 1 842 thous. (in 2021/2022: EUR
64 thous.).
Note 9 Balances and transactions with related entities.
The Parent company: Patro Invest OÜ in Tallinn.
BALANCES AND TRANSACTIONS
WITH RELATED PARTIES FOR
THE PERIOD 01/07/2022 – 30/06/2023
(in thous. EUR)
Interest income
Loans granted
Repayments of
loans granted
Receivables from
loans and interest
at the end of the
period
Parent company:
Patro Invest OÜ
4
126
146
0
Key members of the management and all companies directly or indirectly owned by them :
Patro Administracja sp. z o.o.
12
205
863
226
Damar Patro UÜ
97
1 603
534
4 766
Total
113
1 934
1 543
4 992
Information about long and short term loans is in note 4.
BALANCES AND TRANSACTIONS
WITH RELATED PARTIES FOR
THE PERIOD 01/07/2021 – 30/06/2022
(in thous. EUR)
Interest income
Loans granted
Repayments of
loans granted
Receivables from
loans and interest
at the end of the
period
Parent company:
Patro Invest OÜ
0
41
21
20
Key members of the management and all companies directly or indirectly owned by them :
Patro Administracja sp. z o.o.
24
0
29
897
Damar Patro UÜ
85
49
0
3 590
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
42
Total
109
90
50
4 507
The Company did not issue any guarantees.
Note 10 Remuneration of Management Board and Supervisory Board
Remuneration of supervising and managing
persons
01/07/2022 - 30/06/2023
(in thous.EUR)
01/07/2021 -
30/06/2022
(in thous.EUR)
Supervising persons - members of the Supervisory
Board
0
0
Managing persons
0
0
One management board member ; 4 supervisory board members
The company did not employ any employees in the financial year since July 1, 2022 to June 30,
2023 and in previous financial year lasting since 01/07/2021 to 30/06/2022.
Note 11 Contingent assets and liabilities.
A Tax authorities have the right to review the Company tax records for up to 5 years after
submitting the tax declaration and upon finding errors, impose additional taxes, interest and fines.
The tax authorities have not performed any tax audits at the Company during 2020-2023.
Note 12 Events after the balance sheet date.
There were no significant events after June 30, 2023.
Note 13 Going concern
As at the balance sheet date 30/06/2023, the Company’s equity is less than 50% of the share
capital and does not comply with the requirements of § 301 of the Commercial Code of Estonia.
The Management Board of Investment Friends Capital SE will propose to the general meeting to
reduce the share capital of the Company. The Company has convened a general meeting on
October 6, 2023, during which the share capital will be reduced towards the share premium. Thus,
the requirement set out in § 301 of the Commercial Code of Estonia will be met.
FINANCIAL STATEMENT OF
INVESTMENT FRIENDS CAPITAL SE
FOR THE YEAR ENDED 30/06/2023 /in thous. EUR/
43
VII. MANAGEMENT BOARD’S CONFIRMATION OF THE ANNUAL
REPORT
The Management Board confirms that the management report, corporate governance report and
remuneration report as set out on pages 6 to 18 gives a true and fair view of the key events that
occurred during the reporting period and their impact on the financial statements contains a
description of the key risks and uncertainties, and reflects material transactions with related parties.
The Management Board confirms the correctness and completeness of Investment Friends Capital
SE financial statements for the year 2022/2023 as set out on pages 19 to 42 and that:
the accounting policies used in preparing the financial statements are in compliance with
International Financial Reporting Standards as adopted by the European Union;
the financial statements give a true and fair view of the financial position, financial
performance and cash flows of the Company;
Investment Friends Capital SE is going concern.
Tallinn, 28/09/2023
Damian Patrowicz Member of the MB
First name and last name Position ……....................
Signature
INDEPENDENT AUDITOR’S REPORT
To the Shareholders of INVESTMENT FRIENDS CAPITAL SE
Qualified Opinion
We have audited the financial statements of INVESTMENT FRIENDS CAPITAL SE (the
Company), which comprise the statement of financial position as at June 30, 2023, and the
statement of profit or loss, statement of comprehensive income, statement of cash flows and
statement of changes in equity for the year then ended, and notes to the financial statements,
including a summary of significant accounting policies.
In our opinion, except for the possible effects of the matter described in the Basis for Qualified
Opinion section of our report the accompanying financial statements present fairly, in all
material respects, the financial position of the Company as at June 30, 2023, and its financial
performance and its cash flows for the year then ended in accordance with International
Financial Reporting Standards (IFRS) as adopted by the European Union.
Basis for Qualified Opinion
The Company's statement of financial position as of 30.06.2023 contains loan and interest
receivables against the related company Damar Patro UÜ in the amount of 4,766 thousand
euros. Damar Patro UÜ's assets mainly consist of funds in investment accounts, which are
recognized at fair value. In the year ended on 30 June 2023, the fair value of Damar Patro
UÜ's investment portfolios has decreased, and the company's liabilities exceed its assets. Due
to the above, we do not have enough certainty whether the mentioned loans and interest
receivables would require a discount or not.
The Company's statement of financial position as of 30.06.2023 contains loan and interest
receivables against the related company Patro Administracija Sp. z.o.o. in the amount of 226
thousand euros. Patro Administracija SP z.o.o. liabilities exceeded current assets, which is an
indication of payment difficulties. During the audit, we did not get enough certainty whether the
mentioned loan and interest receivables would require a discount or not.
We conducted our audit in accordance with International Standards on Auditing (Estonia) (ISA
(EE)s). Our responsibilities under those standards are further described in the Auditor’s
Responsibilities for the Audit of the Financial Statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Independence
We are independent of the Company in accordance with the International Code of Ethics for
Professional Accountants (including International Independence Standards) issued by the
International Ethics Standards Board for Accountants (IESBA Code). We have fulfilled our
other ethical responsibilities in accordance with the IESBA Code.
To the best of our knowledge and belief, we declare that non-audit services that we have
provided to the Company are in accordance with the applicable law and regulations in the
Republic of Estonia and that we have not provided non-audit services that are prohibited under
§ 59
1
of the Auditors Activities Act of the Republic of Estonia.
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. For each matter
below, our description of how our audit addressed the matter is provided in that context.
Key audit matter
How our audit addressed the key audit
matter
Valuation of loan receivables
As disclosed in the Note 4 “Financial
assets” to the financial statements,
financial assets consist of loans and
interests in the amount of 4 999 thousand
euros which corresponds to 99% of the
Company’s assets. All of these loans are
loans to the related parties.
The value of these loans is assessed using
the amortized cost method as described in
the Note 1 to the financial statements.
Valuation of receivables is a subjective
area due to the level of judgement applied
by the management, based on
management’s past experience and
assumptions.
Our audit procedures included, amongst
others:
• We examined the terms of the loan
agreements and checked the
accounting data compliance with
the agreements.
• We checked the balances with the
balance confirmations.
• We examined and analyzed the
financial data of the borrowers; we
reviewed whether management’s
judgements are in accordance with
our understanding.
• We checked the received payments
of the loans after the post balance
sheet date.
• We assessed the adequacy of the
disclosed information and
compliance with IFRS
requirements.
Other Information, including the Management Report
Management is responsible for the other information. The other information comprises the
Selected Financial Data, the Management Report, the Corporate Governance Report and the
Remuneration Report (but does not include the financial statements and our auditor’s report
thereon). Our opinion on the financial statements does not cover the other information,
including the Management report.
In connection with our audit of the financial statements, our responsibility is to read the other
information identified above 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. With respect to the Management report, we also
performed the procedures required by the Auditors Activities Act. Those procedures include
considering whether the Management report is consistent, in all material respects, with the
financial statements and is prepared in accordance with the requirements of the Accounting
Act.
In accordance with the Securities Market Act with respect to the Remuneration Report, our
responsibility is to consider whether the Remuneration Report includes the information in
accordance with the requirements of Article 135
3
of the Securities Market Act.
Based on the work undertaken in the course of our audit, in our opinion:
• the information given in the Management report for the financial year for which the
financial statements are prepared is consistent, in all material respects, with the
financial statements; and
• the Management report has been prepared in accordance with the requirements of the
Accounting Act;
• the Remuneration Report has been prepared in accordance with Article 135
3
of the
Securities Market Act.
• As described in the "Basis for Qualified Opinion" section, we did not get sufficient
certainty about possible impairment estimates in the statement of financial position. We
are not able to make conclusions whether other information has been misrepresented
in connection to this fact or not.
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 International Financial Reporting Standards (IFRS) as adopted by the
European Union and for such internal control as management determines is necessary to
enable the preparation of 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 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 or to cease operations, or has no realistic alternative but to
do so.
Those charged with governance are responsible for overseeing the Company’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 (EE) 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 (EE), we exercise professional judgment and
maintain professional skepticism 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 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
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 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.
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, actions taken to eliminate threats or safeguards applied.
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.
Appointment and period of our audit engagement
We were first appointed as auditors of Investment Friends Capital SE for the financial year
ended 30 June 2020. Our appointment has been renewed by shareholder resolutions,
representing the total period of our uninterrupted engagement appointment for Investment
Friends Capital SE of 4 years.
/digitally signed/
Eve Leppik
License No 230
Company: Number RT OÜ
License: 263
Linnu tee 21a, Tallinn 11317
28. September 2023
