AUDIT ORGANISATION

To check and confirm the annual financial statements of the Company for 2023, the General Meeting of Shareholders approved the Audit Organisation of the Company in accordance with Art. 47, 48, 54 and 88 of the Federal Law “On Joint-Stock Companies”, para. 11 item 10.2 of Art. 10, item 11.1 of Art. 11, item 24.11 of Art. 24 of the Articles of Associations of the Company.

Selection of an audit organisation

The Company’s Board of Directors suggests a candidate for an audit organisation to be appointed on the annual General Meeting of Shareholders in the course of preparation and holding of this Meeting.

The Company’s auditor was selected through an electronic tender held by an organisation authorised by the Company in accordance with the Company’s Unified Procurement Standard (Procurement Regulations).

To ensure the objectivity and independence of the external auditor of the Company, it is selected through electronic competitive tender procedure conducted in the Unified Information System of the Russian Federation in Procurements www.zakupki.gov.ru, using the electronic trading platform of Rosseti.

https://rosseti.roseltorg.ru

Information about the competition for the right to conclude a contract for audit services for 2023 was posted on the website www.zakupki.gov.ru. The deadline for the tender is 24 April 2023. According to the results of the tender, the collective participant consisting of the leader of the collective participant LLC Centre for Audit Technologies and Solutions (TsATR) – Audit Services and the participant LLC Crowe Audex Auditing and Consulting Company. Tenderers were evaluated according to criteria previously established and declared in the tender terms.

The external auditor conducts the audit of statements in line with the requirements of the legislation of the Russian Federation based on a concluded agreement.

To perform the mandatory audit of the Group’s RAS financial statements and IFRS consolidated financial statements for 2023, the Company’s Board of Directors recommended (Minutes No. 522/2023 dated 11 May 2023) and appointed on 9 June 2023 by resolution of the Company’s Annual General Meeting of Shareholders (Minutes No. 26 dated 13 June 2023) a collective participant consisting of LLC TsATR – Audit Services (leader of the collective participant) and LLC Crowe Audex (member of the collective participant).

LLC TsATR – Audit Services is a member of the self-regulatory organisation of auditors Association “Sodrugestvo”.

LLC Crowe Audex is a member of the self-regulatory organisation of auditors Association “Sodrugestvo”.

The Company’s Board of Directors sets fees for an audit organisation according to item 24.12 of Art. 24 of the Articles of Association of PJSC Rosseti South.

An agreement between the Company and an audit organisation stipulates service fees and terms of payment for the audit organisation. The resolution of the Board of Directors of the Company dated 8 June 2023 (Minutes No. 526/2023 dated 9 June 2023) determined the amount of payment for services rendered by the audit organisation of PJSC Rosseti South, the leader of the collective participant LLC TsATR – Audit Services, under the contract for the provision of audit services for the audit of RAS accounting (financial) statements for 2023 and audit of the IFRS consolidated financial statements for the year ended 31 December 2023, amounting to RUB 2,510,640.00 (Two million five hundred and ten thousand six hundred and forty), including VAT (20%). No non-audit services were provided in the reporting year.

The Auditor is not affiliated with employees or management of the Company. The Company has no business relations (participation in promotion of products (services), participation in joint entrepreneurial activities, etc.), as well as family ties with officials of the leader of the collective participant of LLC TsATR – Audit Services.

PERFORMANCE EVALUATION OF AN EXTERNAL AUDIT

In accordance with the opinion of the Company’s internal audit on the assessment of the audit performance, auditors’ conclusions, and efficiency of the external audit of the accounting (financial) statements of PJSC Rosseti South for 2023:

• The procedures performed by LLC TsATR – Audit Services during the external audit of the Company’s financial statements for 2023 comply with the terms of the concluded contract and the requirement of Federal Law No. 307-FZ “On Auditing” dated 30 December 2008
• The independent Auditor’s audit report on the Company’s accounting (financial) statements for 2023 was prepared in accordance with Federal Law No. 307-FZ dated 30 December 2008 “On Auditing”, International Standards on Auditing, and contains an opinion expressed in the prescribed form on the reliability of the audited entity’s (PJSC Rosseti South) financial statements
• Based on the results of the questionnaire survey of the members of the Audit Committee of the Board of Directors of the Company, the average integral score of the communication and interaction level of the External Auditor of the Company is three points, which corresponds to the assessment “compliant/satisfied (no deviations)” and means that the level of interaction of the External Auditor with the members of the Audit Committee in 2023 complied with the requirements of International Standard on Auditing 260 “Information Interaction with Persons Responsible for Corporate Governance” and the accepted standards and expectations of the Company.