Audit firm selection

PwC was entered by the National Council of Statutory Auditors on the list of audit firms under no. 144.

The aforementioned audit firm and members of the team auditing the financial statements of the Company and the Group met the conditions for preparing an impartial and independent report on the audit of the annual financial statements in accordance with applicable regulations, professional standards and principles of professional ethics.

FFiL Śnieżka SA adheres to the applicable regulations related to the rotation of the audit firms and the key statutory auditor and mandatory grace periods.

The Company took advantage of the PwC’s services regarding audit and review of financial statements from 2016 to 2023.

The remuneration of the PwC audit firm, due for the audit of the annual and review of the interim financial statements of the Group and the Company and for the assurance services for the financial year ended 31 December 2024 and the previous financial year ended 31 December 2023 is included in:

• Standalone financial statements of FFiL Śnieżka SA for 2024 in note 3.22,
• Consolidated financial statements of the Śnieżka Group in note 3.24.

FFiL Śnieżka SA has a policy on selecting an audit firm and a policy on providing additional non-audit services by an audit firm.

The selection of an audit firm is carried out in accordance with the Policy on selecting an audit firm to conduct the audit and review of financial statements (available on the Company’s website adopted by a resolution of the Audit Committee on January 27, 2023.

The policy corresponds to the Procedure on selecting an audit firm prepared by the Audit Committee and adopted by a resolution of January 27, 2023. The policy on selecting an audit firm to conduct the audit and review of financial statements determines the guidelines and principles that the Audit Committee should be driven by at the stage of preparing recommendations and the supervisory board by selecting an entity empowered to audit the financial statements of the Company and the Śnieżka Group. They take into account the requirements resulting from the Act of 11 May 2017 on statutory auditors, audit firms and public supervision, and in particular:

• the need to maintain the impartiality and independence of the audit firm and the statutory auditor;
• previous experience of the audit firm in the audit and review of public interest entities and capital groups;
• potential to perform the scope of services whose performance is to be entrusted to the audit firm (i.e. statutory audit and review of separate and consolidated financial statements);
• holding (in the appropriate value) an insurance policy against the civil liability by an audit firm;
• professional qualifications and experience of persons directly involved in audit activities;
• the price proposed by an audit firm;
• time of conducting the audit and review of the financial statements;
• the maximum period of uninterrupted duration of audit orders and statutory reviews carried out by the same audit firm or an audit firm related to that audit firm or any member of the network operating in the European Union to which these audit firms belong, not exceeding 10 years;
• the interval between the audits and statutory inspections carried out in the same public interest entity for a period of 10 years, amounting to at least the next 4 years, counting from the end of the last audit and statutory inspection;
• the statutory auditor may not conduct audit and statutory review in the same public interest entity for a period longer than 5 years. The statutory auditor may conduct the statutory audit and review in the entity referred to in the preceding sentence again after at least 3 years have elapsed from the end of the last statutory audit and review.

The policy corresponds to the Procedure on selecting an audit firm, which takes into account cooperation of a member of the management board – the CFO, the Audit Committee and the Supervisory Board. The aim of the procedure is to efficiently and effectively collect bids from audit firms, which are subsequently analysed by the Audit Committee, in order to submit to the Supervisory Board an appropriate recommendation on selecting entities authorized to perform the audit. The recommendation covers at least two audit firms together with the justified preference of the Audit Committee for one of the presented entities. The final decision regarding the selection of an audit firm is made by the Supervisory Board. However, if the Supervisory Board decides to select another entity than recommended by the Audit Committee, it should provide reasons for departing from the Audit Committee’s recommendation and provide such justification to the shareholders at the general meeting of the Company.

Additional services provided by an audit firm are set out in the Policy of providing by an audit firm conducting audits and reviews of financial statements by entities related to this audit firm and by a member of the audit firm network of permitted non-audit services adopted by the resolution of the Audit Committee of January 27, 2023.

The indicated policy has been in force at FFiL Śnieżka SA since 2023. The core assumption of this document is to minimize the risk that a statutory auditor or an audit firm conducting audits of the Company’s financial statements (or other entities mentioned in the title of this policy) provides directly or indirectly to the audited entity, its parent company or its subsidiaries within the European Union, any prohibited services other than auditing or auditing activities. The exceptions are services set out in art. 136 sec. 2 of the Act on statutory auditors, audit firms and public supervision (The act on Statutory Auditors), the provision of which is possible only to the extent not related to the tax policy of FFiL Śnieżka SA, after carrying out by the audit committee an assessment of threats and safeguards of independence and expressing a relevant consent. In addition, if the statutory auditor or audit firm provides the services referred to above, these entities are obliged to comply with the regulations contained in art. 69-73 of the act on Statutory Auditors determining solutions aimed at ensuring the independence and objectivity of the statutory auditor and the audit firm.

By resolution of the Audit Committee of 2 April 2025 and resolution of the Supervisory Board of 9 April 2025, the above-mentioned policies and procedure were repealed and in lieu of them the following new policies and procedure were adopted and approved:

• The policy for the provision of permitted services other than audit or assurance of sustainability reporting by an audit firm conducting an audit of financial statements or assurance of sustainability reporting, by entities related to that audit firm and by a member of the network to which the audit firm belongs in favour of Fabryka Farb i Lakierów “Śnieżka” S.A. with its registered office in Warsaw.
• The policy for selecting an audit firm to audit financial statements and assure sustainable development reporting by the public interest entity Fabryka Farb i Lakierów “Śnieżka” S.A. with its registered office in Warsaw.
• The procedure for selecting an audit firm by a public interest entity – Fabryka Farb i Lakierów “Śnieżka” S.A. with its registered office in Warsaw.