Independent Auditor's Report - Komplett Bank ASA (3) the parameters such as the probability of default (PD) and loss given default (LGD) and calculations made. • Classification of the various loans by risk. • How the loans are classified into different stages. The Company’s business is concentrated on consumer loans, credit cards and point of sales. Its internal models are designed to take into account the specific characteristics of each of its products and enable the Company to estimate loan loss impairment provisions for each of these products. See notes 1.1, 3 and 16 for the description of the Company’s models and processes to estimate loan-loss impairment provisions based on IFRS 9. • the reliability and accuracy of the data used for calculation purposes in the models. Our testing of internal controls did not indicate material errors in the modelling or deviations from IFRS 9. We tested whether the models classified loans in the correct stage and whether the loans were subject to significant increased credit risk by sample size testing of loans against due date and payment history registered in the Company’s system. Our work also included tests of the Company’s financial reporting systems relevant to financial reporting. The Company uses external service organizations for support with their IT systems. The audit team performed detailed substantive testing of relevant reports, automated controls and IT general controls for the external service organization and the company itself. This allowed us to satisfy ourselves with regard to the completeness and accuracy of data in the IT and payment systems relevant to financial reporting. Our testing included, among other things, whether the key calculations made by the core systems were performed in line with expectations, including interest rate calculations. Further, we performed tests on the access controls to the IT systems and segregation of duties where it was relevant for our audit. We have read the relevant notes and found them to be adequate. Other Information The Board of Directors and the Managing Director (management) are responsible for the information in the Board of Directors’ report and the other information accompanying the financial statements. The other information comprises information in the annual report, but does not include the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the information in the Board of Directors’ report nor the other information accompanying the financial statements. In connection with our audit of the financial statements, our responsibility is to read the Board of Directors’ report and the other information accompanying the financial statements. The purpose is to consider if there is material inconsistency between the Board of Directors’ report and the other information accompanying the financial statements and the financial statements or our knowledge obtained in the audit, or whether the Board of Directors’ report and the other information accompanying the financial statements otherwise appears to be materially misstated. We are required to report if there is a material misstatement in the Board of Directors’ report or the other information accompanying the financial statements. We have nothing to report in this regard. Komplett Bank / Annual Report 2021 91
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