DSV Annual Report 2022

92 DSV Annual Report 2022 Statements = III Independent Auditor's reports To the shareholders of DSV A/S Report on the audit of the Financial Statements Our opinion In our opinion, the Consolidated Financial Statements and the Parent Company Financial Statements give a true and fair view of the Group's and the Parent Company's financial position at 31 December 2022 and of the results of the Group's and the Parent Company's operations and cash flows for the financial year 1 January to 31 December 2022 in accord- ance with International Financial Reporting Standards ('IFRS') as issued by the International Accounting Standards Board ('IASB') and in accordance with IFRS as adopted by the EU and further requirements in the Danish Financial Statements Act. Our opinion is consistent with our Auditor's Long-form Report to the Audit Committee and the Board of Directors. What we have audited The Consolidated Financial Statements and Parent Company Financial Statements of DSV A/S for the financial year 1 January to 31 December 2022 comprise income statement and statement of comprehensive income, cash flow statement, balance sheet, statement of changes in equity and notes, including summary of significant accounting policies for the Group as well as for the Parent Company. Collectively referred to as the "Financial Statements". Basis for opinion We conducted our audit in accordance with International Standards on Auditing (ISAs) and the additional requirements applicable in Denmark. Our responsibilities under those standards and requirements 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 Group in accordance with the International Ethics Standards Board for Accountants' International Code of Ethics for Professional Accountants (IESBA Code) and the additional ethical require- ments applicable in Denmark. We have also fulfilled our other ethical re- sponsibilities in accordance with these requirements and the IESBA Code. To the best of our knowledge and belief, prohibited non-audit services referred to in Article 5(1) of Regulation (EU) No 537/2014 were not provided. Appointment We were first appointed auditors of DSV A/S on 9 March 2017 for the financial year 2017. We have been reappointed annually by shareholder resolution for a total period of uninterrupted engagement of six years including the financial year 2022. Key audit matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the Financial Statements for 2022. 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. Revenue recognition, contract assets and accrued cost of services The Group's revenue consists primarily of services, i.e. transportation of goods between destinations, which by nature is rendered over a period of time. We focused on this area, because at year-end, material contract assets and accrued cost of services exist which involve significant accounting estimates and which are complex by nature, i.e. accrual of income (con- tract assets) and related costs (accrued cost of services), including meth- ods and data applied and assumptions made by Management. The process of accruing for services rendered around the balance sheet date is, there- fore, complex and dependent on relevant IT controls in certain operational IT systems. Moreover in the Air & Sea division, an inherent risk exists regarding estimates for recognising revenue in the right period at year end due to the services being rendered over a lengthier period of time. In addition, we focused on this area because of the significance of re- venue and as revenue comprises a substantial number of transactions, including with different characteristics depending on which business segment the revenue relates to. Reference is made to notes 2.2 and 3.4 in the Consolidated Financial Statements. How our audit addressed the key audit matter Our audit procedures included considering the appropriateness of the accounting policies for revenue recognition applied by Management and assessing compliance with applicable financial reporting standards. We updated our understanding of relevant controls, including Group controlling procedures and IT controls, concerning the timing of revenue recognition, contract assets and accrued cost of services, and evaluated. whether these were designed in line with the Group's accounting policies and were operating effectively. For revenue, contract assets and accrued cost of services, we examined reports concerning services in progress and challenged the assumptions made by Management in this regard. Moreover, we selected a sample of transactions during the year and at year-end, and traced these to underlying evidence to determine whether revenue and the related costs are recognised in the right period.

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