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Transparency report

For the period from 1 july 2016 to 30 june 2017


This transparency report has been prepared in accordance with the requirements of § 331 of the law On Audit Services and § 13 of EU Regula 537/2014.


Description of the legal structure and ownership of the audit firm

Grant Thornton Baltic SIA, registration number 50003619401, is a private limited company registered in Riga, Latvia, and its owner is a general partnership Grant Thornton Baltic Holding TÜ, registered in Tallinn, Estonia. 13 private persons – residents of Latvia, Estonia and Lithuania in equal parts, own Grant Thornton Baltic Holding TÜ.

Grant Thornton Baltic Holding TÜ was established on 3 July 2015 and, in accordance with the partnership contract made on 23 September 2015, the partners of the company placed their holdings in the companies of the Grant Thornton Baltic in a holding company. As a result of the structural change, Baltic companies Grant Thornton Baltic SIA, LF Eksperts SIA (merged to Grant Thornton Baltic SIA on 24 April 2017), Rimess Valduse OÜ and Grant Thornton Baltic OÜ became subsidiaries of Grant Thornton Baltic Holding TÜ.

The main reason for the structural change was to bring Estonian, Latvian and Lithuanian enterprises under the common name and management.

Grant Thornton Baltic provides subsidiary auditing, accounting, internal accounting, tax advisory, legal advisory and financial advisory services in Estonia, Latvia and Lithuania. In total, we have six representations in the Baltic States, employing approx. 200 experienced specialists. The number of the clients of the subsidiaries amounts to two and a half thousand and many clients use the services in all the Baltic States.

The purpose of Grant Thornton Baltic is to provide clients with high-level professional auditing and financial advisory services:

- auditing and other auditor’s services;

- financial and business advisory services, incl. valuation, enterprise purchase and sales

advisory services;

- internal audit services;

- tax and legal advisory services;

- accounting services.

In order to provide our clients with the best personal comprehensive solution we involve experts from all of our fields of activity and, where necessary, from different countries, as well. Our advisors provide clients with area-specific expertise that takes into account local and international circumstances. If necessary, we can rely on our colleagues all over the world, because we are members of the Grant Thornton association of audit and business advisory enterprises, which provide services in over 130 countries.

Upon provision of the service, we follow internationally accepted standards and good practice. We ensure service quality via internal as well as international control systems. We service clients in Estonian, Latvian, Lithuanian, English, Russian and Finnish.


Description of the network and the legal and structural arrangements in the network

As of 10 February 2012, Grant Thornton Baltic TÜ along with subsidiaries Grant Thornton Baltic OÜ, Grant Thornton Baltic SIA and Grant Thornton Baltic OÜ’s subsidiary Grant Thornton Baltic UAB are members of the worldwide audit and business advisory association Grant Thornton ( Grant Thornton consists of Grant Thornton International Ltd (the umbrella organisation that does not render services to clients) and independent member firms in over 130 countries. The organisation has over 43,000 employees. In 2015, the turnover of the organisation was 4.6 billion US dollars.

Risks are not pooled within the association. The companies of Grant Thornton Baltic have the right to use the Grant Thornton trademark. Membership in Grant Thornton allows and obligates us to use audit software and participate in professional training. We subject to Grant Thornton’s quality control.

Grant Thornton Baltic SIA is licenced audit company of Latvia, licence number 155 and registered office at Blaumaņa iela 22, Rīga, LV-1011.


Description of the governance structure of the audit firm

The management of Grant Thornton Baltic SIA is organised by certified auditor (Certificate No 171), co-owner of Grant Thornton Baltic TÜ (Managing Partner) and the Chairman of the Board Kaspars Rutkis, who is also in charge of audit and tax & legal service lines. Dainis Tunsts, co-owner of Grant Thornton Baltic TÜ (Partner) and Procurist is in charge of valuation and outsourcing service lines.


Description of the internal quality control system

Managing Partner is responsible for the risk management and internal and quality control system.

Quality control is based on the international quality control standard ISQC1. The said standard has been used as the basis for preparing the Grant Thornton (GT) Baltic Quality Control Handbook, which addresses the following areas:

  • Responsibilities of the management
  • Ethics
  • Acceptance of clients
  • Personnel policy
  • Performance of contracts
  • Monitoring
  • Documentation



Responsibilities of the management

In order to ensure a more efficient functioning of quality control, the managing partner has been named as the Quality Control Partner. His area of responsibility includes the creation and preservation of quality control policies and procedures and informing the personnel of such policies, as well as advising other partners and employees. The person who acts as the Quality Control Partner must have relevant training.



With regard to ethics, the Code of Ethics of the International Federation of Accountants (IFAC) and the ethics principles have been described in the GT Baltic Policies and Procedures Handbook. The ethics principles are delivered to employees via training and in the course of practical work, and compliance with the principles is monitored in the course of quality control.


Acceptance of clients

Upon establishing or continuing a client relationship, consideration is given to the client’s reliability, our competence and resources for performing the contract, and ethical requirements. Above all, competence is understood to mean whether the employees of Grant Thornton Baltic SIA possess knowledge of the relevant industry, whether there is experience with the relevant regulative or reporting requirement or the capability to effectively obtain the necessary skills and knowledge. Resources mean the availability of a sufficient number of employees with the necessary competence, the availability of the persons performing quality control, and the ability to complete the contract by the reporting term.

Prior to accepting international clients, the members of Grant Thornton are obligated to carry out the verification of all existing connections on an international level, in order to avoid any possible conflicts of interest and threats to independence.

The evaluations given in the acceptance of clients are documented.


Personnel policy

The personnel recruitment plan depends on the number of existing clients, the expected growth and personnel turnover. Upon recruitment, the professional qualification, experience and personal traits of candidates are assessed. New employees are familiarised with corporate policies and procedures and introduced to the methodology.

The capabilities and competence of personnel are maintained and improved through training and continual professional development. Training programmes are prepared so as to ensure the training of all personnel and take into account the individual needs of the employees. Employees are given the opportunity to develop their professional skills by participating in as broad a selection of contracts as the number of clients allows.

Further professional development is reviewed as a part of development interviews. The development of employees is assessed at least once a year. The remuneration and promotion of employees is linked to the results of development interviews and based on the achievement of the necessary level in various areas.


Management of audit projects

Audits are carried out using Grant Thornton’s audit software Voyager.

The work of team members with less extensive experience is reviewed by members with more extensive experience. The review of projects includes a review of the work done, the significant evaluations and the final report.

Grant Thornton Baltic SIA has sought to establish a culture where internal consultation is considered a strength, and it has always encouraged employees to seek advice in the case of difficult or controversial circumstances. Conclusions deriving from consultations are documented.


Internal supervision

Internal project quality control prior to issuing an auditor’s report is mandatory in the case of all the projects performed for Public Interest Entities. Quality control prior to issuing a report is also mandatory in the case of complying with other internally established criteria. The person carrying out quality control must have sufficient experience.

In addition to quality control prior to issuing a report, compliance with quality control policies and procedures is monitored internally within the company. The projects of every partner are checked at least once every three years. Monitoring is carried out by experienced and competent persons.

Grant Thornton performs quality control at Grant Thornton Baltic SIA at least once every three years.


Statement by the management body on the effectiveness of its functioning

Grant Thornton Baltic SIA hereby confirms that the risk management and internal and quality control system applied by it functions efficiently.


The last quality assurance review

Pursuant to the law On Audit Services, the Latvian Association of Certified Auditors performs regular quality control at least once every three years with respect to an audit, firm that has entered into a client contract with a Public Interest Entity. The latest quality control by the Latvian Association of Certified Auditors was performed in Grant Thornton Baltic SIA in October 2016, with the positive result.


List of public-interest entities for which the audit firm carried out statutory audits during the preceding financial year

  • Akciju sabiedrība "VEF RADIOTEHNIKA RRR"
  • "Baltikums Vienna Insurance Group" apdrošināšanas akciju sabiedrība


Statement concerning the audit firm's independence practices which also confirms that an internal review of independence compliance has been conducted

With regard to independence, the Code of Ethics of the International Federation of Accountants (IFAC), along with the principles described in the GT Baltic Policies and Procedures Handbook. The topic of independence is addressed at internal training courses.

In order to avoid financial interest in audit clients, Grant Thornton uses the automatic monitoring system GIS. A list of clients with regard to which partners, audit managers and their close ones do not have a financial interest is available to all the member companies.

All the employees who come into contact with audit clients annually submit a written declaration of disclosure of independence, having previously studied the list of clients. Contract teams are formed in such a manner as to exclude any threats to independence. The members of a contract team additionally confirm their independence with regard to the client in writing prior to the commencement of work. Partners, employees and consultants are obligated to report all changes in circumstances concerning the independence declaration.

Independence is analysed both upon accepting a client and continuing the performance of a contract. Any threats to independence, and the protective measures applied shall be documented in audit work documents. Managing Partner must be consulted with respect to circumstances that may threaten independence.

Compliance with independence requirements is verified in the course of quality control and monitoring.

Grant Thornton Baltic SIA hereby confirms that it has been independent in its professional activities and internal review of independence compliance has been conducted.


Statement on the policy followed by the audit firm concerning the continuing education of statutory auditors

The certified auditors’ further training strategy is a part of the general corporate training strategy.

The company prepares a training plan, taking into account the further training requirements stipulated in the law On Audit Services as well as the individual needs of certified auditors and other employees. Certified Auditors and audit managers have to collect at least 40 education hours per year and other staff have to collect at least 16 education hours per year.

Participation in internal training courses, including Grant Thornton e-learning on International Standards of Audit is mandatory for certified auditors and other employees.

Separate records are kept with regard to the participation of certified auditors and other employees in training, in order to ensure better traceability of compliance with the further training requirements stipulated by laws and regulations.


Information concerning the basis for the partners' remuneration in audit firms

Partners (owners) receive a monthly fixed salary. Profit distribution as dividends is carried out once a year in accordance with the Grant Thornton Baltic Holding TÜ partners’ agreement.


Description of the statutory auditor's or the audit firm's policy concerning the rotation of key audit partners and staff

The key audit partners responsible for carrying out a statutory audit shall cease their participation in the statutory audit of the audited entity not later than seven years from the date of their appointment. They shall not participate again in the statutory audit of the audited entity before three years have elapsed following that cessation.

The Grant Thornton Baltic Assurance Quality Control Manual requires the use of the partner rotation tracking spreadsheet in order to track the length of service of senior personnel on assurance engagements. It also requires such an individual rotating after a pre-defined period not to participate in the audit engagement team, or as a key audit partner until a further period of 2 years, has elapsed.


Information about the total turnover of the audit firm

The sales revenue of Grant Thornton Baltic SIA was distributed over the period from 1 July 2016 to 30 June 2017 as follows (EUR):


Total sales revenue, incl.:


Revenues from the statutory audit of annual and consolidated financial statements of public-interest entities


Revenues from the statutory audit of annual and consolidated financial statements of other entities


Revenues from permitted non-audit services to entities that are audited by the statutory auditor or the audit firm


revenues from non-audit services to other entities




Grant Thornton Baltic SIA confirms the correctness of the information provided in this transparency report as of the date of signing the report.




Kaspars Rutkis

Chairman of the Board

Grant Thornton Baltic SIA

17 October 2017

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