Altrecom PLC

Annual / Quarterly Financial Statement • May 31, 2024

REPORT AND CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

REPORT AND CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

CONTENTS PAGE 1 Board of Directors and other officers 2 - 3 Management Report 4 - 6 Independent auditor's report 7 Consolidated statement of profit or loss and other comprehensive income 8 Consolidated statement of financial position g Consolidated statement of changes in equity 10 Consolidated cash flow statement 11 - 34 Notes to the consolidated financial statements

altrecom PLC

BOARD OF DIRECTORS AND OTHER OFFICERS

Board of Directors:	Natalia Kyriakou
	Cleo Koushos-Cros
	Martha Lambrianou
Company Secretary:	Speedy Secretarial Solutions Limited
Independent Auditors:	FINCAP Advisers Ltd Office 101, 1st floor 24 Piraeus Street 2023 Strovolos, Nicosia, Cyprus
Registered office:	Athalassas 62 Mezzanine 2012 Strovolos Nicosia, Cyprus
Bankers:	EcommBX
Registration number:	HE414929

MANAGEMENT REPORT

The Board of Directors presents its report and audited financial statements of the Company and its subsidiaries (together with the Company, the "Group") for the year ended 31 December 2023.

Princinal activities and nature of operations of the Group

The principal activities of the Group, which are unchanged from last year, are the holding of investments and the provision of financing.

Review of current position, and performance of the Group's business

The Group's development to date, financial results and position as presented in the consolidated financial statements are considered satisfactory.

Principal risks and uncertainties

The principal risks and uncertainties faced by the Group are dischsed in notes 7, 8 and 26 of the consolidated financial statements.

Corporate Governance

The CSE has established a Corporate Governance Code (The Group does not apply the Code, taking into consideration the small size of the Group, the fact that the Group does not employ a high number of employees and that its principal activities are the holding of investments and provision of financing. These advocate for the nonadoption of the Code, as the relative cost increase would not be justified under the circumstances.

Existence of branches

The Group does not maintain any branches.

Share capital

On the 30 August 2023 the Board of Directors authorised share capital of the Company to be increased from €25,629,49 divided into 24,883 ordinary shares of €1,03 each to €112,295,629,49 divided into 109,024,883 ordinary shares of nominal value of €1,03 each by the creation of 109.000.000 ordinary shares of nominal value of €1,03 which rank pari passu in all respects, with existing ordinary shares of the Company.

On the 21st of December 2023, further to the announcement dated 30 August 2023, 118.162 bonds of nominal value of €1,000 each were converted into ordinary shares of nominal value of 1,03 each of the conversion price of €0,927 per share. As result, 108.347.033 new shares of the Company were issued.

The trading of the new shares commenced on 21 December 2023.

Board of Directors

The members of the Group's Board of Directors as at 31 December 2023 and at the date of this report are presented on page 1. All of them were members of the Board of Directors throughout the year ended 31 December 2023.

In accordance with the Company's Articles of Association all Directors presently members of the Board continue in office.

There were no significant changes in the assignment of responsibilities and remuneration of the Board of Directors.

Events after the reporting period

Any significant events that occurred after the end of the reporting period are described in note 30 to the consolidated financial statements.

Related party transactions

Disclosed in note 27 of the consolidated financial statements,

MANAGEMENT REPORT

Independent Auditors

The Independent Auditors, FINCAP Advisers Ltd, have expressed their willingness to continue in office and a resolution giving authority to the Board of Directors to fix their remuneration will be proposed at the Annual General Meeting.

By order of the Board of Directors,

leg

Natalia Kyriakou Director

Nicosia, 31 May 2024

taking you further Member of Russell Bedford International

Independent Auditor's Report

To the Members of Altrecom Plc

Report on the Audit of the Consolidated Financial Statements

Opinion

We have audited the consolidated financial statements of Altrecom Pic (the "Company") and its subsidiaries (the "Group"), which are presented in pages 7 to 34 and comprise the consolidated statement of financial position as at 31 December 2023, and the consolidated statements of profit or loss and other comprehensive income, changes in equity and cash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements give a true and fair view of the consolidated financial position of the Group as at 31 December 2023, and of its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and the requirements of the Cyprus Companies Law, Cap. 113.

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the "Auditor's Responsibilities for the Consolidated Financial Statements" section of our report. We are independent of the Group in accordance with the International Ethics Standards Board for Accountants' International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code) together with the ethical requirements that are relevant to our audit of the consolidated financial statements in Cyprus, and we fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Other information

The Board of Directors is responsible for the other information comprises the information included in the Management Report, but does not include the consolidated financial statements and our auditor's report thereon.

Our opinion on the consolidated financial statements does not cover information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Board of Directors for the Consolidated Financial Statements

The Board of Directors is responsible for the preparation of consolidated financial statements that give a true and fair view in accordance with International Reporting Standards as adopted by the European Union and the requirements of the Cyprus Companies Law, Cap. 113, and for such internal control as the Board of Directors determines is necessary to enable the preparation of consolidated financial statements that are from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, the Board of Directors is responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

4

Nicosia | Limassol | London | Hong Kong

Russell Bed

Member of Russell Bedford International

taking you further

Responsibilities of the Board of Directors for the Consolidated Financial Statements (continued)

The Board of Directors is responsible for overseeing the Group's financial reporting process.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Board of Directors.
• Conclude on the appropriateness of the Board of Directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves a true and fair view.
• Obtain sufficient and appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the remain solely responsible for our audit opinion.

We communicate with the Board of Directors 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.

Nicosia | Limassol | London | Hong Kong

Milli Russell Bedford taking you further

Member of Russell Bedford International

Report on Other Legal Requirements

Pursuant to the additional requirements of the Auditors Law of 2017, we report the following:

• In our opinion, the Management Report has been prepared in accordance with the requirements of the Cyprus Companies Law, Cap 113, and the information given is consistent with the consolidated financial statements.
• In our opinion, and in the light of the knowledge and understanding of the Group and its environment » obtained in the course of the audit, we have not identified material misstatements in the Management Report

Other Matter

This report, including the opinion, has been prepared for and only for the Group's members as a body in accordance with Section 69 of the Auditors Law of 2017 and for no other purpose. We do not, in giving this opinion, accept or assume responsibility for any other purpose or to any other person to whose knowledge this report may come to.

Angelos Freodorou

Eertified Public Accountant and Registered Auditor for and on behalf of

FINCAP Advisers Ltd Certified Public Accountants and Registered Auditors

Nicosia, 31 May 2024

Nicosia | Limassol | London | Hong Kong

consolidated Statement of Profit or Loss and OTHER COMPREHENSIVE INCOME 31 December 2023

	Note	2023 uss	2022 ાટક
Loan interest income	17	6,066,737	2,382,422
Net gain on trading in financial instruments	20		948,760
Net fair value changes	19	(18,286)	(8,586,619)
Other operating income	ರಿ	3,736,921
Administration expenses	10	(1,628,643)	(1,652,002)
Provision for impairment on bank balances		(14,868)
Operating profit/(loss)		8,141,861	(6,907,439)
Net finance (costs)/income	12	(7,193,217)	3,405,438
Profit/(loss) before tax		948,644	(3,502,001)
Tax	13
Net profit/(loss) for the year/period		948,644	(3,502,001)
Other comprehensive income
Total comprehensive income for the year/period		948,644	(3,502,001)
Profit/(loss) per share attributable to equity holders of the parent (cent)	14	0.01	(140.74

CONSOLIDATED STATEMENT OF FINANCIAL POSITION 31 December 2023

		2023	2022
ASSETS	Note	US\$	પાટિક
Non-current assets
Right-of-use assets	15	8,199	23,742
Loans receivable	17	72,242,531	186,852,866
		72,250,730	186,876,608
Current assets
Other receivables	18	35,383	53,429
Loans receivable	17	116,175,111
Financial assets at fair value through profit or loss Cash and cash equivalents	19 21	91,806 813,105	2,536,579 4,245,387
		117,115,405	6,835,395
Total assets		189,366,135	193,712,003
EQUITY AND LIABILITIES
Equity
Share capital	22	123,345,285	30,108
Other reserves		922,000
Accumulated losses		(4,937,148)	(5,885,792)
Total equity		119,330,137	(5,855,684)
Non-current liabilities
Borrowings	23	69,970,306	187,184,596
Lease liabilities	24		6,003
Other payables	25	69,970,306	12,290,611 199,481,210
Current liabilities
Other payables	25	57,112	68,027
Lease liabilities	24	8,580	18,450
		65,692	86,477
Total liabilities		70,035,998	199,567,687
Total equity and liabilities		189,366,135	193,712,003

On 31 May 2024 the Board of Directors of Altrecom Plc authorised these consolidated financial statements for issue,

....... fra................

Natalia Kyriakou Director

Cleo Kesshos-Cros Director

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

31 December 2023

	Note	Share capital પાર્ટફ	Capital reserve પાકિ	Accumulated Osses US\$	Total પાર્ટફ
Balance at 1 January 2022		30,108			(2,383,791) (2,353,683)
Comprehensive loss Net loss for the period Total comprehensive loss for the period				(3,502,001) (3,502,001)	(3,502,001) (3,502,001)
Balance at 31 December 2022/ 1 January 2023		30,108			(5,885,792) (5,855,684)
Comprehensive income Net profit for the year Total comprehensive income for the year				948,644 948,644	948,644 948,644
Transactions with owners Issue of share capital Advances from owners Total transactions with owners	22	123,315,177 123,315,177	922,000 922,000		123,315,177 922,000 124,237,177
Balance at 31 December 2023		123,345,285	922,000		(4,937,148) 119,330,137

During the year 2023, the parent entity contributed the amount of \$922,000 by the way of non-refundable advances to the Company.

Companies, which do not distribute 70% of their profits after tax, as defined by the Special Contribution for the Defence of the Republic Law, within two years after the end of the relevant tax year, will be deemed to have distributed this amount as dividend on the 31 of December of the second year. The amount of the deemed dividend distribution is reduced by any actual dividend already distributed by 31 December of the year the profits relate. The Company pays special defence contribution on behalf of the shareholders over the amount of the deemed dividend distribution at a rate of 17% (applicable since 2014) when the entitled shareholders are natural persons tax residents of Cyprus and have their domicile in Cyprus. In addition, the Company pays on behalf of the shareholders General Healthcare System (GHS) contribution at a rate of 2,65%, when the entitled shareholders are natural persons tax residents of Cyprus, regardless of their domicile.

altrecom PLC

CONSOLIDATED CASH FLOW STATEMENT

31 December 2023

		LUCO	2017
	Note	US\$	nest
CASH FLOWS FROM OPERATING ACTIVITIES
Profit/(loss) before tax		948,644	(3,502,001)
Adjustments for:
Depreciation of right-of-use assets	15	15,543	17,905
Unrealised exchange loss/(profit)		3,208,925	(10,720,559)
Fair value losses on financial assets at fair value through profit or loss		18,286
Impairment charge on cash and cash equivalents	21	14,869
Other income
Gain on conversion of bonds to shares	ੀ	3,732,473
Interest income	17	(6,066,737)	(2,626,001)
Interest expense	12	9,289,986	6,636,411
Other interest income	19	(28,077)
Gain on disposal	20		948,760
Interest lease liability		480	ರಿ88
		11,134,392	(9,244,497)
Changes in working capital:
Decrease/(increase) in other receivables		18,046	(19,040)
Decrease in financial assets at fair value through profit or loss		2,049,539	20,598,404
(Decrease)/increase in other payables		(12,801,526)	11,387,092
Cash generated from operations		400,451	22,721,959
CASH FLOWS FROM INVESTING ACTIVITIES	17		(22,692,297)
Loans granted	17	(1,225,917)
Loans repayments received		164,596	22,218,677
Payment for purchase of other investments	20		(11,107,840)
Exchange Differences on Ioans			(5,077,210)
Proceeds from sale of other investments	20		12,181,186
Interest received	19	28,077	243,579
Net cash used in investing activities		(1,033,244)	(4,233,905)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayments of borrowings	23	(3,283,136)
Payments of leases liabilities		(16,353)	(17,786)
Proceeds from borrowings		500,000
Interest paid			(933,418)
Net cash used in financing activities		(2,799,489)	(951,204)
Net (decrease)/increase in cash and cash equivalents		(3,432,282)	17,536,850
Cash and cash equivalents at beginning of the year/period		4,245,387	(13,291,463)
Cash and cash equivalents at end of the year/period	21	813,105	4,245,387

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

31 December 2023

1. Incorporation and principal activities

Country of incorporation

Altrecom Plc (the "Company") was incorporated in Cyprus on 7 November 2020 as a private limited liability company under the provisions of the Cyprus Companies Law, Cap. 113. Its registered office is at Athalassas 62, Mezzanine, Strovolos 2012, Nicosia.

Principal activities

The principal activities of the Group, which are unchanged from last year, are the holding of investments and the provision of financing.

2. Basis of preparation

These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union (EU) and the requirements of the Cyprus Companies Law, Cap. 113. These consolidated financial statements have been prepared under the historical cost convention as modified by the revaluation of financial assets and financial liabilities at fair value through profit or loss.

3, Functional and presentation currency

The consolidated financial statements are presented in United States Dollars (US\$) which is the functional currency of the Group.

4. Adoption of new or revised standards and interpretations

During the current year the Group adopted all the new and revised International Financial Reporting Standards (IFRS) that are relevant to its operations and are effective for accounting periods beginning on 1 January 2023. This adoption did not have a material effect on the accounting policies of the Group.

5. Significant accounting policies

The principal accounting policies adopted in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all years presented in these consolidated financial statements unless otherwise stated.

Basis of consolidation

The Company has subsidiary undertakings for which section 142(1)(b) of the Cyprus Companies Law Cap. 113 requires consolidated financial statements to be prepared and laid before the Company at the Annual General Meeting. The Group consolidated financial statements comprise the financial statements of the parent company Altrecom Plc and the financial statements of the following subsidiaries, Donimaro Limited and Earth S.R.O.

The financial statements of all the Group companies are prepared using uniform accounting policies. All intercompany transactions and balances between Group companies have been eliminated during consolidation,

Business combinations

Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the Group, liabilities incurred by the former owners of the acquiree and the equity interests issued by the Group in exchange for control of the acquiree. Acquisition-related costs are generally recognised in profit or loss as incurred.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

5. Significant accounting policies (continued)

Business combinations (continued)

At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their fair value at the acquisition date, except that:

• deferred tax assets or liabilities or assets related to employee benefit arrangements are recognised and measured in accordance with IAS 12 Income Taxes and IAS 19 Employee Benefits respectively;
• liabilities or equity instruments related to share-based payments of the acquiree or sharebased payment arrangements of the Group entered into to replace share-based payment arrangements of the acquiree are measured in accordance with IFRS 2 Share-based Payment at the acquisition date; and
• assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations are measured in accordance with that Standard.

Goodwill is measured as the excess of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer's previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer's previously held interest in the acquiree (if any), the excess is recognised immediately in profit or loss as a bargain purchase gain.

When the consideration transferred by the Group in a business combination includes assets or liabilities resulting from a contingent consideration arrangement, the contingent consideration is measured at its acquisition-date fair value and included as part of the consideration transferred in a business combination. Changes in the fair value of the contingent consideration that qualify as measurements are adjusted retrospectively, with corresponding adjustments against goodwill. Measurements are adjustments that arise from additional information obtained during the 'measurement period' (which cannot exceed one year from the acquisition date) about facts and circumstances that existed at the acquisition date.

The subsequent accounting for changes in the fair value of the contingent consideration that do not qualify as measurement period adjustments depends on how the contingent consideration is classified. Contingent consideration that is classified as equity is not remeasured at subsequent reporting dates and its subsequent settlement is accounted for within equity. Contingent consideration that is classified as an asset or a liability is remeasured at subsequent reporting dates in accordance with IAS 39, or IAS 37 Provisions, Contingent Liabilities and Contingent Assets, as appropriate, with the corresponding gain or loss being recognised in profit or loss.

If the initial accounting for a business combination is incomplete by the reporting period in which the combination occurs, the Group reports provisional amounts for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period (see above), or additional assets or liabilities are recognised, to reflect new information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognised at that date.

Revenue

Recognition and measurement

The Company recognises revenue as follow:

Income from investments in securities

Profits or losses from the sale of investments in securities represent the difference between the net proceeds and the carrying amount of the investments sold and is transferred to profit or loss. Changes in fair value of investments at fair value through profit or loss are included in profit or loss in the period in which it arises.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

31 December 2023

5. Significant accounting policies (continued)

Revenue (continued)

Interest income

Interest income is recognised on a time-proportion basis using the effective interest method,

Other Investments

Other investments are stated at cost less provision for impairment in value, which is recognised as an expense in the period in which the impairment is identified.

Finance încome

Interest income is recognised on a time-proportion basis using the effective method.

Finance costs

Interest expense and other borrowing costs are charged to profit or loss as incurred.

Foreign currency translation

(1) Functional and presentation currency

Items included in the Group's financial statements are measured using the currency of the primary economic environment in which the entity operates ('the financial statements are presented in United States Dollars (US\$), which is the Group's functional and presentation currency.

(2) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevalling at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss. Translation differences on non-monetary items such as equities held at fair value through profit or loss are reported as part of the fair value gain or loss.

Leases

At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract control the use of an identified asset, the Group assesses whether:

• the contract involves the use of an identified asset this may be specified explicitly, and should be physically distinct or represent substantially all of the capacity of a physically distinct asset. If the supplier has a substantive substitution right, then the asset is not identified;
• ... the Group has the right to obtain substantially all of the economic benefits from use of the asset throughout the period of use; and
• the Group has the right to direct the use of the Group has this right when it has the decision-making rights that are most relevant to changing how and for what purpose the asset is used. In rare cases where the decision about how and for what purpose the asset is used is predetermined, the Group has the right to direct the use of the asset if either:
  • the Group has the right to operate the asset; or -
  • the Group designed the asset in a way that predetermines how and for what purpose it will be used.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

5. Significant accounting policies (continued)

Leases (continued)

At inception or on reassessment of a contract that contains a lease component, the Group allocation in the contract to each lease component on the basis of their relative stand-alone prices. However, for the leases of land and buildings in which it is a lessee, the Group has elected not to separate non-lease components and account for the lease and non-lease components as a single lease component.

The Group as lessee

The Group recognises a right-of-use asset and a lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received.

The right-of-use asset is subsequently depreciated using the method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the lease term, The estimated useful lives of the right-of-use assets are determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group's incremental borrowing rate.

Lease payments included in the measurement of the lease liability comprise the following:

• fixed payments, including in-substance fixed payments;
• variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date:
• amounts expected to be payable under a residual value guarantee; and
• the exercise price under a purchase option that the Group is reasonably certain to exercise, lease payments in an optional renewal period if the Group is reasonably certain to exercise an extension option, and penalties for early termination of a lease unless the Group is reasonably certain not to terminate early.

The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Group's estimate of the amount expected to be payable under a residual value guarantee, or if the Group changes its assessment of whether it will exercise a purchase, extension or termination option.

When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the right-of-use asset has been reduced to zero.

The Group presents its right-of-use assets that do not meet the definition of investment property in 'Property, plant and equipment' in the consolidated statement of financial position.

The lease liabilities are presented in 'loans and borrowings' in the consolidated statement of financial position.

Short-term leases and leases of low-value assets

The Group has elected not to recognise the right of use assets and lease liabilities for short term leases that have a lease term of 12 months or less and leases of low value assets (i.e. IT equipment etc.). The Group recognises the lease payments associated with these leases as an expense on a straight line base term.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

31 December 2023

5. Significant accounting policies (continued)

Impairment of non-financial assets

Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, Assets that are subject to depreciation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units). Non financial assets, other than goodwill, that have suffered an impairment are reviewed for possible reversal of the impairment at each reporting date.

Financial assets

Financial assets - Classification

The Group classifies its financial assets in the following measurement categories:

• those to be measured subsequently at fair value (either through OCI or through profit or loss), and
• those to be measured at amortised cost. .

The classification and subsequent measurement of debt financial assets depends on: (i) the Group's business model for managing the related assets portfolio and (ii) the cash flow characteristics of the asset. On initial recognition, the Group may irrevocably designate a debt financial asset that otherwise meets the requirements to be measured at amortized cost or at FVOCI or at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.

For investments in equity instruments that are not held for trading, the classification will depend on whether the Group has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value through other comprehensive income (FVOCI). This election is made on an investment basis.

All other financial assets are classified as measured at FVTPL.

For assets measured at fair value, gains and losses will either be recorded in profit or loss or OCI. For investments in equity instruments that are not held for trading, this will depend on whether the Group has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value through other comprehensive income (FVOCI).

Financial assets - Recognition and derecognition

All purchases and sales of financial assets that require delivery within the time frame established by regulation or market convention ("regular way" purchases and sales) are recorded at trade date, which is the Group commits to deliver a financial instrument. All other purchases and sales are recognised when the entity becomes a party to the contractual provisions of the instrument.

Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership.

Financial assets - Measurement

At initial recognition, the Group measures a financial asset at its fair value plus, in the case not at fair value through profit or loss (FVTPL), transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at FVTPL are expensed in profit or loss. Fair value at inttial recognition is best evidenced by the transaction price. A gain or loss on initial recognition is only recorded if there is a difference between fair value and transaction price which can be evidenced by other observable current market transactions in the same instrument or by a valuation technique whose inputs include only data from observable markets.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

5. Significant accounting policies (continued)

Financial assets (continued)

Financial assets - Measurement (continued)

Financial assets with embedded derivatives are considered in their entirely when determining whether their cash flows are solely payment of principal and interest,

Financial assets - impairment - credit loss allowance for ECL

The Group assesses on a forward-looking basis the ECL for debt instruments (including Joans) measured at amortised cost and FVOCI and exposure arising from loan commitments and financial guarantee contracts. The Group measures ECL and recognises credit loss allowance at each reporting date. The measurement of ECL reflects: (i) an unbiased and probability weighted amount that is determined by evaluating a range of possible outcomes, (ii) time value of money and (ii) all reasonable and supportable information that is available without undue cost and effort at the end of each reporting period about past events, current conditions and forecasts of future conditions.

The carrying amount of the financial assets is reduced through the use of an allowance account, and the amount of the loss is recognised in the consolidated statement of profit or loss and other comprehensive income within "net impairment losses on financial and contract assets. Subsequent recoveries of amounts for which loss allowance was previously recognised are credited against the same line item.

Debt instruments carried at amortised cost are presented in the consolidated statement of financial position net of the allowance for ECL, For loan commitments and financial guarantee contracts, a separate provision for ECL is recognised as a liability in the consolidated statement of financial position.

The impairment methodology applied by the Group for calculating expected credit losses depends on the type of financial asset assessed for impairment. Specifically:

For trade receivables and contract assets, including tract assets with a significant financing component, and lease receivables the simplified approach permitted by IFRS 9, which requires lifetime expected credit losses to be recognised from initial recognition of the financial assets.

For all other financial instruments that are subject to impairment under IFRS 9, the Group applies general approach three stage model for impairment. The Group applies a three stage model for impairment, based on changes in credit quality since initial recognition. A financial instrument that is not credit-impaired on initial recognition is classified in Stage 1.

Financial assets in Stage 1 have their ECL measured at an amount equal to the portion of lifetime ECL that results from default events possible within the next 12 months or until contractual maturity, if shorter ("12 Months ECL"). If the Group identifies a significant increase in credit risk ("SICR") since initial recognition, the asset is transferred to Stage 2 and its ECL is measured based on ECL on a lifetime basis, that is, up until contractual maturity but considering expected prepayments, if any ("Lifetime ECL"), Refer to note 7, Credit risk section, for a description of how the Group determines when a SICR has occurred. If the Group determines that a financial asset is creditimpaired, the asset is transferred to Stage 3 and its ECL is measured as a Lifetime ECL. The Group's definition of credit impaired assets and definition of default is explained in note 7, Credit risk section.

Additionally the Group has decided to use the low credit risk assessment exemption for investment grade financial assets. Refer to note 7, Credit risk section for a description of how the Group determines low credit risk financial assets.

Financial assets -Reclassification

Financial instruments are reclassified only when the business model for managing those assets changes. The reclassification has a prospective effect and the start of the first reporting period following the change.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

31 December 2023

5. Significant accounting policies (continued)

Financial assets (continued)

Financial assets - write-off

Financial assets are written-off, in whole or in part, when the Group exhausted all practical recovery efforts and has concluded that there is no reasonable expectation of recovery. The write-off represents a derecognition event. The Group may write-off financial assets that are still subject to enforcement activity when the Group seeks to recover amounts that are contractually due, however, there is no reasonable expectation of recovery.

Financial assets - modification

The Group sometimes renegotiates or otherwise the contractual terms of the financial assets. The Group assesses whether the modification of contractual cash flows is substantial considering, among other, the following factors: any new contractual terms that substantially affect the risk profile of the asset (e.g. profit share or equitybased return), significant change in interest rate, change in the currency denomination, new collateral or credit enhancement that significantly affects the credit risk associated with the asset or a ban when the borrower is not in financial difficulties.

If the modified terms are substantially different, the rights to cash flows from the original asset expire and the Group derecognises the original financial asset and recognises a new asset at its fair value. The date of renegotiation is considered to be the date of initial recognition for subsequent impairment calculation purposes, including determining whether a SICR has occurred. The Group also assesses whether the new loan or debt instrument meets the SPPI criterion. Any difference between the carrying amount of the original asset derecognised and fair value of the new substantially modified asset is recognised in profit or loss, unless the substance of the difference is attributed to a capital transaction with owners.

In a situation where the renegotiation was driven by financial difficulties of the counterparty and inability to make the originally agreed payments, the Group compares the original and revised cash flows to assets whether the risks and rewards of the asset are substantially different as a result of the contractual modification. If the risks and rewards do not change, the modified asset is not substantially different from the original asset and the modification does not result in derecognition. The Group recalculates the gross carrying amount by discounting the modified contractual cash flows by the original effective interest rate, and recognises a modification gain or loss in profit or loss.

Cash and cash equivalents

For the purpose of the consolidated cash flow statement, cash and cash equivalents comprise cash at bank, cash with brokers and cash in hand. Cash equivalents are carried at amortised cost because: (i) they are held for collection of contractual cash flows and those cash flows represent SPPI, and (ii) they are not designated at FVTPL.

Classification as financial assets at amortised cost

These amounts generally arise from transactions outside the usual operating activities of the Group. They are held with the objective to collect their contractual cash flows represent solely payments of principal and interest. Accordingly, these are measured at amortised cost using the effective interest method, less provision for impairment. Financial assets at amortised cost are classified as current assets if they are due within one year or less (or in the normal operating cycle of the business if longer). If not, they are presented as non-current assets.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

31 December 2023

5. Significant accounting policies (continued)

Financial assets (continued)

Financial liabilities - measurement categories

Financial liabilities are initially recognised at fair value and classified as subsequently measured at amortised cost, except for (i) financial liabilities at FVTPL: this classification is applied to derivatives, financial liabilities held for trading (e.g. short positions in securities), contingent consideration recognised by an acquirer in a business combination and other financial liabilities designated as such at initial recognition and (ii) financial guarantee contracts and loan commitments.

A financial liability is derecognised when the liability is discharged or cancelled or expires.

Borrowings

Borrowings are recorded initially at the proceeds received, net of transaction costs incurred. Borrowings consist of Convertible Bonds that are subsequently measured at amortized cost using effective interest rate.

Financial liabilities - Modifications

An exchange between the Group and its original lenders of debt instruments with substantially different terms, as well as substantial modifications of the terms and conditions of existing financial liabilities, are accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. The terms are substantially different if the discounted present value of the new terms, including any fees paid net of any fees received and discounted using the original effective interest rate, is at least 10% different from the discounted present value of the remaining cash flows of the original financial liability. (In addition, other qualitative factors, such as the currency that the instrument is denominated in, changes in the type of interest rate, new conversion features attached to the instrument and change in loan covenants are also considered.)

If an exchange of debt instruments or modification of terms is accounted for as an extinguishment, any costs or fees incurred are recognised as part of the extinguishment. If the exchange or modification is not accounted for as an extinguishment, any costs or fees incurred adjust the carrying amount of the liability and are amortised over the remaining term of the modified liability.

Modifications of liabilities that do not result in extinguishment are accounted for as a change in estimate using a cumulative catch up method, with any gain or loss recognised in profit or loss, unless the economic substance of the difference in carrying values is attributed to a capital transaction with owners and is recognised directly to equity,

Borrowing costs are interest and other costs that the Group incurs in connection with the borrowing of funds, including interest on borrowings, amortisation of discounts or premium relating of ancillary costs incurred in connection with the arrangement of borrowings, finance lease charges and exchange differences arising from foreign currency borrowings to the extent that they are regarded as an adjustment to interest costs.

Borrowing costs that are directly attributable to the acquisition or production of a qualifying asset, being an asset that necessarily takes a substantial period of time to get ready for its intended use or sale, are capitalised as part of that asset, when it is probable that they will result in future economic benefits to the Group and the costs can be measured reliably.

Offsetting financial instruments

Financial assets and financial liabilities are offset and the net amount reported in the consolidated statement of financial position if, and only if, there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, or to realise the liability simultaneously. This is not generally the case with master netting agreements, and the related assets and liabilities are presented gross in the consolidated statement of financial position.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

31 December 2023

5. Significant accounting policies (continued)

Prepayments

Prepayments are carried at cost less provision for impairment. A prepayment is classified as non-current when the goods or services relating to the prepayment are expected to be obtained after one year, or when the prepayment relates to an asset which will itself be classified as non-current upon initial recognition. Prepayments to acquire assets are transferred to the carrying amount of the asset once the Group has obtained control of the asset and it is probable that future economic benefits associated with the asset will flow to the Group. Other prepayments are written off to profit or loss when the goods or services relating to the prepayments are received. If there is an indication that the assets, goods or services relating to a prepayment will not be received, the carrying value of the prepayment is written down accordingly and a corresponding impairment loss is recognised in profit or loss,

Share capital

Ordinary shares are classified as equity.

Capital Reserve

Capital reserve consists of advances made by the Company's shareholders other than for the issue of shares by the Company in their capacity as equity owners of the Company has no contractual obligation to repay them. Such contributions are recognised directly in equity as they constitute transactions with equity owners in their capacity as equity owners of the Company.

Provisions

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount can be made. Where the Group expects a provision to be reimbursed, for example under an insurance contract, the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain.

Non-current liabilities

Non-current liabilities represent amounts that are due more than twelve months from the reporting date.

Fair value measurement

The carrying amounts of the Group's financial assets and liabilities approximate their fair value at the reporting date.

The fair value of financial assets traded in active markets is based on quoted market prices at the reporting date. The quoted market price used for financial assets held by the Group is the appropriate quoted market price for financial liabilities is the current ask price.

The fair value of financial assets that are not traded in an active market is determined by using valuation techniques. The Group uses a variety of methods, such as estimated discounted cash flows, and makes assumptions that are based on market conditions existing at the reporting date.

All assets, liabilities and equity items for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole.

• Level 1 quoted prices (unadjusted) in active markets for identical assets or liabilities.
• Level 2 inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices),
• Level 3 inputs for the asset or liability that are not based on observable market data (unobservable inputs).

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

31 December 2023

5. Significant accounting policies (continued)

Comparatives

Where necessary, comparative figures have been adjusted to conform to changes in presentation in the current year.

6. New accounting pronouncements

At the date of approval of these consolidated financial statements, standards and interpretations were issued by the International Accounting Standards Board which were not yet effective. Some of them were adopted by the European Union and others not yet. The Board of Directors expects that the adoption of these accounting standards in future periods will not have a material effect on the consolidated financial statements of the Group.

7. Financial risk management

Financial risk factors

The Group is exposed to interest rate risk, tredit risk, currency risk and capital risk management arising from the financial instruments it holds. The risk management policies employed by the Group to manage these risks are discussed below:

7.1 Cash flow and fair value interest rate risk

The Group's interest rate risk arises from interest-bearing assets and long term borrowings. Interest-bearing assets and borrowings at variable rates expose the Group to cash flow interest rate risk. Interest bearing assets and borrowings issued at fixed rates expose the Group to fair value interest rate risk.

At the reporting date the interest rate profile of interest- bearing financial instruments was:

	2023	2022
	ી ટિર્ટ	પાટિક
Fixed rate instruments
Financial assets	188,417,642 189,389,445
Financial liabilities	(69,970,306) (199,475,207)
	118,447,336 (10,085,762)

The Group's Management monitors the interest rate fluctuations on a continuous basis and acts accordingly.

7.2 Credit risk

Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to meet an obligation. Credit risk arises from cash equivalents, contractual cash flows of debt investments carried at amortised cost, and deposits with brokers and investement firms, as well as credit exposures to wholesale and retail customers, including outstanding receivables. Further, credit risk arises from credit related commitments.

(i) Risk management

The Group's investments in equity and debt instruments are considered to be low risk investments. The credit ratings of the investments are monitored for credit deterioration.

These policies enable the Group to reduce its credit risk significantly.

(ii) Impairment of financial assets

The Group has the following types of financial assets that are subject to the expected credit loss model:

• loans receivables from related parties
• cash and cash equivalents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

7. Financial risk management (continued)

7.2 Credit risk (continued)

(ii) Impairment of financial assets (continued)

The impairment methodology applied by the Group for calculating expected credit losses depends on the type of financial asset assessed for impairment. Specifically:

• For trade receivables the Group applies the simplified approach permitted by IFRS 9, which requires lifetime expected losses to be recognised from initial recognition of the financial assets.
• For all other financial assets that are subject to impairment under IFRS 9, the Group applies general approach - three stage model for impairment. The Group applies a three-stage model for impairment, based on changes in credit quality since initial recognition. A financial asset that is not credit-impaired on initial recognition is classified in Stage 1. Financial assets in Stage 1 have their ECL measured at an amount equal to the portion of lifetime ECL that results from default events possible within the next 12 months or until contractual maturity, if shorter ("12 Months ECL"). If the Group identifies a significant increase in credit risk ("SICR") since initial recognition, the asset is transferred to Stage 2 and its ECL is measured based on ECL on a lifetime basis, that is, up until contractual maturity but considering expected prepayments, if any ("Lifetime ECL"). If the Group determines that a financial asset is credit-impaired, the asset is transferred to Stage 3 and its ECL is measured as a Lifetime ECL.

Impairment losses are presented as net impairment losses on financial and contract assets within operating profit. Subsequent recoveries of amounts previously written off are credited against the same line item.

Low credit risk

The Group has decided to use the low credit risk assessment exemption for investment grade financial assets. Management consider 'low credit risk' for listed bonds to be an investment grade credit rating with at least one major rating agency. Other instruments are considered to be low credit risk when they have a low risk of default and the issuer has a strong capacity to meet its contractual cash flow obligations in the near term.

Default

A default on a financial asset is when the counterparty fails to make contractual payments within 90 days of when they fall due.

Write-off

Financial assets are written off when there is no reasonable expectation of recovery, such as a debtor failing to engage in a repayment plan with the Group categorises a debt financial asset for write off when a debtor fails to make contractual payments greater than 180 days past due. Where debt financial assets have been written off, the Group continues to enforcement activity to attempt to recover the receivable due. Where recoveries are made, these are recognised in profit or loss,

The Group's exposure to credit risk for each class of (asset/instrument) subject to the expected credit is set out below:

Receivables from related parties

For receivables from related parties lifetime ECL was provided for them upon initial application of IFRS 9 until these financial assets are derecognised as it was determined on initial application of IFRS 9 that it would require undue cost and effort to determine whether their credit risk has increased significantly since initial recognition to the date of initial application of IFRS 9,

For any new loans to related parties, which are not purchased or originated credit-impaired financial assets, the impairment loss is recognised as 12-month ECL on initial recognition of such instruments and subsequently the Group assesses whether there was a significant increase in credit risk.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

31 December 2023

7. Financial risk management (continued)

7.2 Credit risk (continued)

(ii) Impairment of financial assets (continued)

Receivables from related parties (continued)

The gross carrying amounts below represent the Group's maximum exposure to credit risk on these assets as at 31 December 2023 and 31 December 2022:

Group internal credit rating	2023	2022
	ારક	US\$
Performing	116,175,111
Total	116,175,111

The Group does not hold any collateral as security for any receivables from related parties.

There were no significant receivables from related parties written off during the year that are subject to enforcement activity.

Cash and cash equivalents

The Group assesses, on a group basis, its exposure to credit risk arising from cash at brokers and payment institutions. This assessment takes into account, ratings from external credit rating institutions and internal ratings, if external are not available.

Bank deposits held with banks with investment grade rating are considered as low credit risk.

The gross carrying amounts below represent the Group's maximum exposure to credit risk on these assets as at 31 December 2023 and 31 December 2022:

Group internal credit rating	2023	2022
	પરિક	US\$
Performing	827,973	4,245,387
Provision for Expected Credit Loss	(14.868)
Total	813,105	4,245,387

The Group does not hold any collateral as security for any cash at bank balances.

There were no significant cash at balances written off during the year that are subject to enforcement activity.

(iii) Net impairment losses on financial and contract assets recognised in profit or loss

During the year, the following gains/(losses) were recognised in profit or loss in relation to impaired financial assets and contract assets:

Impairment losses	2023	2022
	પરિક	પાર્ટફ
Impairment charge on cash and cash equivalents	(14.868)
Net impairment loss on financial and contract assets	(14,868)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

31 December 2023

7. Financial risk management (continued)

7.2 Credit risk (continued)

(iv) Financial assets at fair value through profit or loss

The Group is also exposed to credit risk in relation to equity and debt investments that are measured at fair value through profit or loss. The maximum exposure at the end of the reporting period is the carrying amount of these investments US\$91,806 (2022: US\$2,536,579).

7.3 Liquidity risk

Liquidity risk is the risk that arises when the maturity of assets and liabilities does not match. An unmatched position potentially enhances profitability, but can also increase the risk of losses. The Group has procedures with the object of minimising such losses such as maintaining sufficient cash and other highly liquid current assets and by having available an adequate amount of committed credit facilities.

The following tables detail the Group's remaining contractual maturity for its financial liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Group can be required to pay. The table includes both interest and principal cash flows.

31 December 2023	Carrying	Contractual	3 months or
	amounts	cash flows	િકેટ	3-12 months	1-2 years	2-5 years
	ાટિક	ાટિર્દ્	വട്ടു	ાર્ટફ	US\$	તિર્ટફે
Lease liabilities	8,580	8,662		8,662
Other payables	1,620	1,620		1,620
Loans from related parties	69,970,306	71,380,210			71,380,210
	69,980,506 71,390,492				10,282 71,380,210
31 December 2022	Carrying	Contractual	3 months or
	amounts	cash flows	്ട്രട്ട	3-12 months	1-2 years	2-5 years
	પાર્ટફ	ાટિર્દ	ાટક	ારક	US\$	પાર્ટફ
Lease liabilities	24,453	24,453		18,450	6,003
Convertible bond	116,825,067	134,883,197		943,730	943,730	132,995,737
Other loans	70,359,529	75,284,696				75,284,696
Other payables	12,299,428	12,299,428		8,817		12,290,611
	199,508,477	222,491,774		970,997		949,733 220,571,044

7.4 Currency risk

Currency risk is the risk that the value of financial instruments will fluctuate due to changes in foreign exchange rates. Currency risk arises when future commercial transactions and recognised assets and liabilities are denominated in a currency that is not the Group's measurement currency. The Group is exposed to foreign exchange risk arising from various currency exposures primarily with respect to the Group's Management monitors the exchange rate fluctuations on a continuous basis and acts accordingly.

The carrying amounts of the Group's foreign currency denominated monetary liabilities at the reporting date are as follows:

		Liabilities		Assets
	2023	2022	2023	2022
	US\$	US\$	પાસ્ટર્સ	પિટિટેટ
Euro	8.580		129,142,948 188,417,642	120.469.379
			8,580 129,142,948 188,417,642 120,469,379

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

31 December 2023

7. Financial risk management (continued)

7.4 Currency risk (continued)

The following significant exchange rates have been applied during the year.

		Average rate		Year-end spot rate
	2023	2022	2023	2022
	પાર્ટફ	ાટિક	પાર્ટફ	ાટિક
Euro 1	1.0813	1.0530	1.1050	1.0666

7.5 Capital risk management

Capital includes equity shares.

The Group manages its capital to ensure that it will be able to continue as a going concern while maximising the return to shareholders through the optimisation of the debt and equity balance. The Group's overall strategy remains unchanged from last year.

8. Critical accounting estimates, judgments and assumptions

Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Critical accounting estimates and assumptions

The Group makes estimates and assumptions concerning the resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

Going concern basis

Management has made an assessment of the Group's ability to continue as a going concern.

Calculation of loss allowance

When measuring expected credit losses the Group uses reasonable and supportable forward looking information, which is based on assumptions for the future movement of different economic drivers and how these drivers will affect each other.

Loss given default is an estimate of the loss arising on default. It is based on the difference between the contractual cash flows due and those that the lender would expect to receive, taking into account cash flows from collateral and integral credit enhancements.

Probability of default constitutes a key input in measuring ECL. Probability of default is an estimate of the likelihood of default over a given time horizon, the calculation of which includes historical data, assumptions and expectations of future conditions.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

8. Critical accounting estimates, judgments and assumptions (continued)

Critical judgements in applying the Group's accounting policies

Impairment of loans receivable D

The Group periodically evaluates the recoverability of loans receivable whenever indicators of impairment are present. Indicators of impairment include such items as declines in revenues, earnings or cash flows or material adverse changes in the economic or political stability of a particular country in which the borrower operates, which may indicate that the carrying amount of the loan is not recoverable. If facts and circumstances indicate that loans receivable may be impaired, the estimated future discounted cash flows associated with these loans would be compared to their carrying amounts to determine if a write-down to fair value is necessary.

Impairment of financial assets �

The loss allowances for financial assets are based on assumptions about risk of default and expected loss rates. The Group uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the Group's past history, existing market conditions as well as forward looking estimates at the end of each reporting period. Details of the key assumptions and inputs used are disclosed in note 7, Credit risk section.

Valuation of non-listed investments

The Group uses various valuation methods to value non-listed investments. These methods are based on assumptions made by the Board of Directors which are based on market information at the reporting date.

9. Other operating income

	2023	2022
	US\$	US\$
Profit from sale of financial assets at fair value through profit or loss Gain from conversion of bonds to shares	4,448
	3.732.473
	3,736,921

10. Administration expenses

	2023	2022
	પાકિસ્	വടക
Staff costs (Note 11)	740,616	819,275
Annual levy	755	742
Sundry expenses	64,613	1,031
Telephone and postage		3,986
Auditors' remuneration	27,523	20,209
Other professional fees	599,924	77,767
Operating expenses	112,041	369,407
Office expenses	4,101	2,522
Representative expenses	23,452	100,400
Commissions	40,075	240,835
Depreciation of right-of-use assets	15,543	15,828
	1,628,643	1,652,002

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

11, Staff costs

Salaries	2023 પડિક 740,616	2022 ાટિક 819,275
	740,616	819,275
Average number of employees (including Directors in their executive capacity)	8	8
12. Finance income/ (costs)
Interest income Exchange profit	2023 ાટિક 28,077 2,211,426	2022 US\$ 243,579 10,808,580
Finance income	2,239,503	11,052,159
Net foreign exchange losses Interest expense on lease liabilities Other interest expense Sundry finance expenses	105 (480) (9,289,506) (142,839)	(713,341) (988) (6,636,411) (295,981)
Finance costs	(9,432,720)	(7,646,721)
Net finance (costs)/income	(7,193,217)	3,405,438

13. Tax

The corporation tax rate is 12,5%.

Under certain conditions interest income may be subject to defence contribution at the rate of 30%. In such cases this interest will be exempt from corporation tax. In certain cases, dividends received from abroad may be subject to defence contribution at the rate of 17%.

Gains on disposal of qualifying titles (including shares, bonds, debentures, rights thereon etc) are exempt from Cyprus income tax.

14. Profit/(loss) per share attributable to equity holders of the parent

	2023	2022
Profit/ (loss) attributable to shareholders (US\$)	948,644	(3,502,001)
Weighted average number of ordinary shares in issue during the year	108,371,916	24.883
Profit/(loss) per share attributable to equity holders of the parent (cent)	0.01	(140.74)

Diluted EPS is the same as basic EPS.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

15. Right-of-use assets

	Offices വടക
Cost Additions
Balance at 31 December 2023	50,423
Depreciation Charge for the year Charge for the year Balance at 31 December 2023	17,905 15,543 42,224
Net book amount
Balance at 31 December 2023	8,199
Balance at 31 December 2022	23,742

Amounts recognised in profit and loss:

	2023	2022
	પાર્ટફ	પર્ટફ
Depreciation expense on right-of-use assets	(15,543)	15,828)
Exchange differences		(2,077)
Interest expense on lease liabilities	(480)	(ਰੇਲੋਸ਼)

On 1st of July 2021, the Company entered into a one year lease agreement for its offices, with renewal options. Rental contracts are typically made for fixed period of three years and may have extensions or automatic renewal options. The managements intention is to renew the lease agreement for three years. The lease agreement do not impose any covenants other than the security interests in the leased assets that are held by the lessed assets may not be used as security for borrowing purposes.

16. Investments in subsidiaries

The details of the subsidiaries are as follows:

Name	Country of incorporation	Principal activities	Holding 0/0
Donimaro Limited	Cyprus	Holding of investments and provision of financing	100
Earth S.R.O.	Slovakia	Trading Services	100

During the year, Altrecom PLC contributed the amount of \$985,304.00 by way of non-refundable advances to Donimaro Limited,

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

17. Loans receivable

	2023	2022
	પાસ્ટેદ	ાટક
Balance at 1 January	186,852,866	58,841,786
New loans granted	1,225,917	142,820,125
Repayments	(12,751,721)	(50,000)
Interest charged	6,066,698	2,382,422
Exchange differences from arising from changing currency of the loan	7,023,882	5,077,210
Assignment of Ioan		(22,218,677)
Balance at 31 December	188,417,642	186,852,866
	2023	2022
	ારકે	ાટિક
Loans receivable	188,417,642	186,852,866
	188,417,642	186,852,866
Less current portion	(116,175,111)
Non-current portion	72,242,531	186,852,866

On 20 April 2021, the Company entered into a loan agreement with Athletic Enterprises Limited, an unrelated entity, for the principal amount of \$56,900,000 and an annual interest rate of 3.5%. The maturity date of the loan is 20 April 2025.

On 23 November 2021, the Company has entered into a credit facility agreement with the same unrelated entity for an amount up to €1,000,000. As at 31 December 2021, the Company lend an amount of €420,000. The credit facility has an annual interest rate of 0.25% and repayment date by 1 September 2026. On 10 November 2022, it was agreed by both parties to increase the interest rate from 0.25% to 3.75% annualy. On 16 November 2022, it was agreed by both parties to extend the credit facility up to €1,400,000.

On 21 December 2022, the Company has entered into a credit facility agreement with the same entity for an amount up to €1,000,000, which was increased to €1,500,000 on 19 April 2023. As at 31 December 2022, the Company lend an amount of €260,000. During 2023, an additional amount of €1.048.500 (equivalent to US\$1.225.917) was granted. The credit facility has an annual interest rate of 3.75% and repayment date by 21 December 2025.

On 21 December 2022, the Company has entered into an agreement with an unrelated entity, Aspro Investment LLC( the "Seller"), for the purchase of 5 promisory notes by another unrelated entity, Esmena Investments Ltd (the "Issuer" )with the total consideration being €112,580,000.

The Company agreed to assign the rights and obligations of the Donimaro Limited indebtedness of US\$102,300,768.13 to the Seller as a partial settlement of the consideration price. Promissory notes bare an annual interest of 3.5%.

Following the Assignment in 2022, the Company was left with a payable amount of €11,240,023.47 (\$12,290,611) to the Seller. On 29 November 2023, the amount was set off against the amount due from Promissory Notes from Esmena Investment I I

The loans are repayable as follows:

and the submit and the submit and the submit and the security of

	2023	2022
	US\$	ાટક
Within one year (Note 27.2)	116,175,111
Between one and five years	72,242,531 186,852,866
	188,417,642 186,852,866

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

17. Loans receivable (continued)

The exposure of the Group to credit risk in relation to loans receivable is reported in note 7 of the consolidated financial statements.

The fair values of non-current receivables approximate to their carrying amounts as presented above.

18. Other receivables

	2022	2022
	પાટિક	ાર્ટફ
Shareholders' current accounts - debit balances (Note 27.4)		29,977
Deposits and prepayments	5,406	23,452
Other receivables	29,977
	35,383	53,429

Other receivables were settled in February 2024.

The fair values of other receivables due within one year approximate to their carrying amounts as presented above.

The exposure of the Group to credit risk and impairment losses in relation to other receivables is reported in note 7 of the consolidated financial statements.

19, Financial assets at fair value through profit or loss

	2023	2022
	દિશ્વ	ાટિક
	2023	2022
	uss	પાટિદ્દ
Balance at 1 January	2,536,579	38,355,664
Additions	43,663	2,124,739
Disposals	(2,498,227)	(29,600,784)
Change in fair value	(18,286)	(8,586,619)
Interest Charged	28,077	243,579
Balance at 31 December	91,806	2,536,579

The financial assets at fair value through profit or loss are marketable securities and are value at the close of business on 31 December by reference to quoted bid prices. Financial assets at fair value through profit or loss are classified as current assets because they are expected to be realised within twelve months from the reporting date.

In the consolidated cash flow statement, financial assets at fair value through profit or loss are presented within the section on operating activities as part of changes in working capital. In the consolidated statement of profit or loss and other comprehensive income, changes in fair values of financial assets at fair value through profit or loss are recorded in operating income.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

20. Other investments

	2023	2022
	દિવે	પાટિક
Balance at 1 January	1	124,586
Additions		11,107,840
Disposals	l	(12,056,600)
Repayment	I	(124,586)
Gain on disposals		948,760
Balance at 31 December

On 6 September 2021, the Company entered into an Investment with a third party, for an amount up to €550,000 interest free. The Investee shall repay the invested amount not later than the 6th of September 2026 and pay 60% of annual profits gained from investement activity. As at 31 December 2021, the Company invested an amount of €110.000 (equivalent to \$124.586).

On 14 November 2022 the third party has repaid its amount owed to the company of €110,000 (\$124,586) along with the 60% of the profits of the third party as described in the agreement above.

21. Cash and cash equivalents

For the purposes of the consolidated cash flow statement, the cash equivalents include the following:

	2023	2022
	પાર્ટફ	ાટકર્
Cash in hand	1,647	11
Cash with brokers	757,713	3,408,511
Cash at payment institutions	54.387	836,784
Current accounts	14.226	81
Provision for impairment on bank balances	(14,868)
	813,105	4,245,387

The exposure of the Group to credit risk and impairment losses in relation to cash equivalents is reported in note 7 of the consolidated financial statements.

22. Share capital

	2023 Number of	2023	7077 Number of	2027
	shares	પાટફ	shares	ાટિક
Authorised
Ordinary shares of €1,03 each	24,883	30,108	24,883	30,108
Ordinary shares of €1,03 each	109,000.000	122,217,122
	109,024,883	122,247,230	24,883	30,108
Issued and fully paid
Balance at 1 January	24,883	30.108	24,883	30.108
Issue of shares	108,347,033	123,315,177
Balance at 31 December	108,371,916	123,345,285	24,883	30,108

On the 30 August 2023 the Board of Directors authorised share capital of the Company to be increased from €25.629,49 divided into 24.883 ordinary shares of €1,03 each to €112.295.629,49 divided into 109.024.883 ordinary shares of nominal value of €1,03 each by the creation of 109.000.000 ordinary shares of nominal value of €1,03 which rank pari passu in all respects, with existing ordinary shares of the Company.

altrecom PLC

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

22. Share capital (continued)

On the 21st of December 2023, further to the announcement dated 30 August 2023, 118.162 bonds of nominal value of €1,000 each were converted into ordinary shares of nominal value of 1,03 each of the conversion price of €0,927 per share. As a result, 108.347.033 new shares of the Company were issued.

23. Borrowings

	2025	2022
	પાર્ટક	US\$
Balance at 1 January	187,184,596	118,022,865
Additions	500,000	102,851,723
Repayments	(3,283,136)	(32,582,021)
Interest		5,692,681
	8,349,901
Unrealised exchange differences		(6,800,652)
Convertion of bonds to shares	(126,513,528)
Gain on conversion of bonds to shares	3,732,473
Balance at 31 December	69,970,306	187,184,596
	2023	2022
	uss	US\$
Non-current borrowings
Convertible bond		116,825,067
Other loans
		70,359,529
Loans from other related parties (Note 27.3)	69,970,306
	69,970,306	187,184,596
Maturity of non-current borrowings:
	2023	2022
	પાસ્ટર્સ	US\$
Between one to two years	69,970,306
Between two and five years		187,184,596
	69,970,306	187,184,596
The effective interest rate at the reporting date was as follows:
	2023	2022
	0/0	0/0
Convertible bond
	6	б

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

23. Borrowings (continued)

On 28 December 2020 and on 24 February 2021, the Company issued 3,530 and 29,412 convertible bonds for a total value of US\$2.000.500 and US\$25.000.200, respectively, which were acquired by a third party of a private term sheet. On 15 April 2022, the third party gave its consent for the 32.942 convertible bond to be converted from US Dollars to Euro using a rate of 1:1 which will be applicable to the nominal value, listing price and annual coupon terms in accordance with the revised private bonds term sheet. Additionally, on 15 April 2022, the Company issued to the third party an amount of 85.220 convertible bonds with a total value of €72.437.000. The convertible bonds bear a coupon rate of 0,75% and have a maturity date of 28th of June 2024.

The bonds were issued to the third party via a private placement.

On 27th of April 2022, the CSE has approved the listing of up to 120.000 bonds (initial listing 118.162 Bonds), with nominal value €1.000 and listing price of €850 each, as well as 24.883 ordinary shares of nominal value and listing price of €1,03 each, pursuant to Article 58 (1) of the Securities and Cyprus Stock Echange Law, as the simultaneous listing of these securities in the Central Regisrty of the CSE, in accordance with respective Law.

24. Lease liabilities

	2023	2022
	પાડફ	ഗട്ടു
Balance at 1 January	24,453	42,239
Exchange differences	315	(2,347)
Interest expense	480	988
Lease payments	(16,668)	(16,427)
Balance at 31 December	8,580	24,453
	2023	2022
	ઘટફ	ાટક
Maturity analysis:
Year 1	8,580	18,450
Year 2		9,225
Year 3		9,225
	8,580	36,900
Less: unearned interest		(3,222)
	8,580	33,678
Analysed as:
Non-current		6,003
Current	8,580	18,450
	8,580	24,453

It is the Company's policy to lease its offices. The average lease term is 36 months. For year ended 31 December 2023, the average effective borrowing rate was 4.5% (2022: 3.7%%). All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

All lease obligations are denominated in Euro.

The fair values of lease obligations approximate to their carrying amounts as presented above.

. . . . . . . . . . . . . . . . . . . . . . .

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

25. Other payables

	2023	2022
	પાસ્ટર્સ	પિટર્દ્ર
Social insurance and other taxes	22,889	40,009
Promissory notes liabilities (Note 17)		12,290,611
Accruals	32,603	19,201
Other creditors	1,620	8,817
	57,112	12,358,638
Less non-current payables		(12,290.611)
Current portion	57.112	68.027

The fair values of other payables due within one year approximate to their carrying amounts as presented above.

26. Operating Environment of the Group

The geopolitical situation in Eastern Europe intensified on 24 February 2022 with the commencement of the conflict between Russia and Ukraine. As at the date of authorising these financial statements for issue, the conflict continues to evolve as military activity proceeds. In addition to the impact of the events on entities that have operations in Russia, Ukraine, or Belarus or that conduct business with their counterparties, the conflict is increasingly affecting economies and financial markets globally and exacerbating ongoing economic challenges.

The European Union as well as United States of America, Switzerland, United Kingdom and other countries imposed aseries of restrictive measures (sanctions) against the Russian government, various companies, andcertain individuals. The sanctions imposed include an asset freeze and a prohibition from making funds available tothe sanctioned individuals and entities. In addition, travel bans applicable to the sanctioned individuals prevents themfrom entering or transiting through the relevant territories. The Republic of Cyprus has adopted the United Nationsand European Union measures. The rapid deterioration of the conflict in Ukraine may as well lead to the possibility offurther sanctions in the future.

Emerging uncertainty regarding global supply of commodities due to the conflict between Russia and Ukraine conflictmay also disrupt certain global trade flows and place significant upwards pressure on commodity prices and inputcosts as seen through early March 2022. Challenges for companies may include availability of funding to ensureaccess to raw materials, ability to finance margin payments and heightened risk of contractual nonperformance.

The impact on the Company largely depends on the nature and duration of uncertain and unpredictable events, suchas further military action, additional sanctions to ongoing developments by global financial markets

The financial effect of the current crisis on the global economy and overall business activities cannot be estimatedwith reasonable certainty at this stage, due to the pace at which the conflict prevails and the high level ofuncertainties arising from the inability to reliably predict the outcome

The Company has no direct exposure to Russia, Ukraine, and as such does not expect significant impactfrom direct exposures to these countries.

27. Related party transactions

The Group is controlled by Esmena Investment Ltd, which owns 99.99% of Altrecom's PLC shares.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 December 2023

27. Related party transactions (continued)

The following transactions were carried out with related parties:

27.1 Directors' remuneration

The remuneration of Directors and other members of key management was as follows:

	2023	2022
	ારકે	ાટિક
Directors' remuneration	45,535	79,564
	45,535	79,564
27.2 Loans to related parties (Note 17)
	2023	2022
	પાર્ટફ	પાટિક
Esmena Investments Ltd	116,175,111
27,3 Loans from related parties (Note 23)
	2023	2022
	પાટફ	nast
Aspro Investment LLC	69,970,306
	69.970.306

27.4 Shareholders' current accounts - debit balances (Note 18)
	2023	2022
	દીર્ટફ	ોટર્સ
Ilya Chernykh		29.977

The shareholders' current accounts are interest free, and have no specified repayment date.

28. Contingent liabilities

The Group had no contingent liabilities as at 31 December 2023 and 31 December 2022.

29. Commitments

The Group had no capital or other commitments as at 31 December 2023 and 31 December 2022.

30. Events after the reporting period

There were no material events after the reporting period, which have a bearing on the understanding of the consolidated financial statements.

As explained in note 26 the geopolitical situation in Eastern Europe intensified on 24 February 2022, with the commencement of the conflict between Russia and Ukraine. As at the date of authorising these consolidated financial statements for issue, the conflict continues to evolve as military activity proceeds and additional sanctions are imposed.

Independent auditor's report on pages 4 to 6

... . . . . . . . .