Independent Auditor’s Report

To ­­Vonovia SE, Bochum

Report on the audit of the consolidated ­financial statements and the combined ­management report

Opinions

We have audited the consolidated financial statements of ­Vonovia SE, Bochum and its subsidiaries (the Group) – which comprise the consolidated balance sheet as at December 31, 2021, the consolidated income statement, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the financial year from January 1 to December 31, 2021, and the notes to the consolidated financial statements including a summary of significant accounting policies. In addition, we have audited the combined management report of ­Vonovia SE for the financial year from January 1 to December 31, 2021. We have not audited the content of the components of the combined management report listed in the “Other Information” section of our auditor’s report in accordance with German legal requirements.

In our opinion, on the basis of the knowledge obtained in the audit,

• the accompanying consolidated financial statements comply, in all material respects, with the IFRSs as adopted by the EU, and the additional requirements of German commercial law pursuant to Section 315e (1) HGB [Handels­gesetzbuch: German Commercial Code] and, in compliance with these requirements, give a true and fair view of the assets, liabilities, and financial position of the Group as at December 31, 2021, and of its financial performance for the financial year from January 1 to December 31, 2021 and
• the accompanying combined management report as a whole provides an appropriate view of the Group’s position. In all material respects, this combined management report is consistent with the consolidated financial statements, complies with German legal requirements and appropriately presents the opportunities and risks of future development. Our opinions on the combined management report do not cover the content of the components of the combined management report listed in the “Other Information” section.

Pursuant to Section 322 (3) sentence 1 HGB [Handelsgesetzbuch: German Commercial Code], we declare that our audit has not led to any reservations relating to the legal compliance of the consolidated financial statements and the combined management report.

Basis for the Opinions

We conducted our audit of the consolidated financial statements and of the combined management report in accordance with Section 317 HGB and the Regulation (EU) (No. 537/2014 on specific requirements regarding statutory audit of public-interest entities and repealing Commission Decision 2005/909/EC; hereinafter referred to as Regulation (EU) No. 537/2014“) and the German Generally Accepted Standards of Financial Statement Audits promulgated by the Institut der Wirtschaftsprüfer [Institute of Public Auditors in Germany] (IDW). We also audited the consolidated financial statements in accordance with the International Standards on Auditing (ISA). Our responsibilities under those requirements, principles and standards are further described in the “Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements and of the Combined Management Report” section of our auditor’s report. We are independent of the group entities in accordance with the requirements of European law and German commercial and professional law, and we have fulfilled our other German professional responsibilities in accordance with these requirements. In addition, pursuant to Article 10 (2) (f) Regulation (EU) No. 537/2014 we declare that we have not provided any prohibited non-audit services in accordance with Article 5 (1) Regulation (EU) No. 537/2014. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinions on the consolidated financial statements and on the combined management report.

Particularly Important Audit Issues in the Audit of the Consolidated Financial Statements

Particularly important audit issues are issues that, in our professional judgment, were the most significant in our audit of the consolidated financial statements for the financial year from January 1 to December 31, 2021. In the context of our audit of the consolidated financial statements and when forming our opinions, these issues were addressed as a whole; we do not issue any separate audit opinions on these issues.

Valuation of investment properties

See notes to the consolidated financial statements items 13 and 28 and the section on opportunities and risks in the combined management report.

Risk for the Financial Statements

Investment properties with a carrying amount of EUR 94.1 billion are recognized in the consolidated financial statements of ­­Vonovia as at December 31, 2021 and represent 88.5% of total assets, a substantial share. Properties in Germany account for EUR 83.3 billion of this figure, Austria for EUR 3.2 billion and Sweden for EUR 7.6 billion. Following the acquisition of Deutsche Wohnen SE, investment properties located exclusively in Germany with a carrying amount of EUR 28.2 billion were added as at September 30, 2021. ­

Vonovia measures the investment properties at fair value in accordance with IAS 40 in conjunction with IFRS 13. EUR 7.4 billion in fair value increases was recognized in the consolidated income statement in the last financial year. ­

Vonovia calculates fair values using internal company valuation models. This excludes the Swedish property portfolios and the new care properties resulting from the acquisition of Deutsche Wohnen SE.

The company calculates this figure internally using discounted cash flow (DCF) methods on the basis of homogeneous valuation units in which economically related and comparable land and buildings are combined. Appraisals are also prepared by independent experts to confirm the internal valuations. The fair value of the Swedish property portfolio and the care properties is calculated by independent experts using DCF methods.

Valuing investment properties is complex and involves numerous assumptions and data that entail considerable estimation uncertainties and judgments. Even minor changes to the assumptions and data relevant to the valuation can result in material changes to the fair values. The most significant assumptions and data are market rents, including the expected rental price trend, planned maintenance costs and the discount and capitalization rates. For the development of discount and capitalization rates, ­Vonovia takes into account the different dynamics of property purchase prices and rental price trends (yield compression).

The estimation uncertainties and discretionary judgment mean that there is a risk for the consolidated financial statements that the fair values of the investment properties are not appropriate.

Another risk for the consolidated financial statements is that the disclosures in the notes required for the investment properties in accordance with IAS 40 and IFRS 13 are not complete and appropriate.

Our Audit Approach

In collaboration with our own property valuation specialists, we evaluated whether the property portfolio data used in the internal company valuation methods are accurate and complete using control-based and substantive audit procedures. We also assessed the valuation methods regarding compliance with IAS 40 in conjunction with IFRS 13, the homogeneity of the valuation units defined and the appropriateness of the valuation assumptions and data used. To evaluate the valuation assumptions and data used such as the discount and capitalization rates, market rents, expected rental price trend and planned maintenance costs, our method included the use of external market data.

We assessed the appropriateness of the assumptions selected for the valuation as at December 31, 2021 of the property portfolio added as a result of the acquisition of Deutsche Wohnen SE based on a representative selection of properties, supplemented by elements deliberately chosen on a risk basis. For this purpose, the appropriateness of the assumptions used in determining the property-specific annual rental growth and the discount and capitalization rates was assessed by comparing them with market and sector-specific benchmarks, taking into account the type and location of the selected properties. On-site inspections were also carried out for selected properties to assess their condition.

For a representative selection of the valuation units located in Germany that were not added as a result of the acquisition of Deutsche Wohnen SE, as well as the valuation units located in Austria, which were supplemented by elements that were deliberately selected on a risk-oriented basis, we compared the appraisals performed by ­Vonovia with our own calculations. Here, we used the standardized German income approach in accordance with the German Real Estate Appraisal Regulation (Immobilienwertermittlungsverordnung – ImmoWertV) for the German properties and the sales comparison approach based on the ImmoWertV for the Austrian properties. We also carried out on-site inspections for the German properties selected here to assess their condition.

Furthermore, we evaluated the mathematical and actuarial accuracy of the valuation models.

We satisfied ourselves that the external experts commissioned by ­Vonovia are competent, capable and objective, assessed the valuation methods used in the appraisals regarding compliance with IAS 40 in conjunction with IFRS 13, assessed the material valuation assumptions and data and compared the internal valuation results with those of the appraisal.

In addition, we assessed the completeness and appropriateness of the disclosures in the notes to the consolidated financial statements required for investment properties under IAS 40 and IFRS 13.

Our Conclusions

­­Vonovia has implemented an appropriate valuation method that is suitable for determining fair values in line with IFRS. The assumptions and data used to value the investment properties are appropriate. The disclosures made in the notes to the consolidated financial statements in accordance with IAS 40 and IFRS 13 for the investment properties are complete and appropriate.

Goodwill impairment

Please see the notes to the consolidated financial statements section 26 for information on the accounting policies applied and assumptions used. Disclosures on the amount of goodwill and impairment can be found in the notes to the consolidated financial statements in section 26. Comments on the operating segments’ business performance are included in section Results of Operations of the group management report.

Risk for the Financial Statements

Goodwill of EUR 2.8 billion is recognized in Vonovia’s consolidated financial statements as at December 31, 2021.

In accordance with IAS 36, goodwill is allocated to the groups of cash-generating units that are expected to benefit from the business combination. At Vonovia, these are the regional business areas in the Rental segment, the Value-­Add and Development segments and the new group of cash-generating units (Care) added as a result of the Deutsche Wohnen acquisition.

Goodwill is routinely tested for impairment each year at the level of the cash-generating units to which the goodwill in question is allocated. If there are indications that the goodwill could be impaired, an ad-hoc impairment test is also conducted. The impairment test compares the carrying amount with the recoverable amount of the cash-generating unit. If the carrying amount is higher than the recoverable amount, it must be written down. The recoverable amount is the higher of the fair value less costs to sell and the value in use of the cash-generating unit.

The reporting date for the routine impairment test is December 31, 2021.

Increased capitalization rates (WACC) and increases in the value of real estate portfolios during the year – where material – may be an indication that goodwill is impaired. For this reason, ­Vonovia carried out ad-hoc impairment testing in the second quarter of 2021. ­

Vonovia also carried out ad-hoc impairment testing in the fourth quarter of 2021 due to additional material increases in the value of real estate portfolios in the second half of 2021. For this, the new goodwill of EUR 4.7 billion arising from the Deutsche Wohnen SE acquisition in the financial year 2021 and determined as part of the still preliminary purchase price allocation as at December 31, 2021 was provisionally allocated to the respective groups of cash-generating units at Vonovia. ­

Vonovia calculates the value in use as part of a complex calculation model using a DCF method. As well as projections of future cash flows, the determination of the WACC is also to be considered discretionary. As even minor changes to the projections of future cash flows/the WACC can have a material impact on the recoverable amount, there are considerable estimation uncertainties regarding the measurement of goodwill.

In the regional business areas in the Rental segment, the different dynamics of property purchase prices and rental price trends (yield compression) have a major impact on goodwill impairment, as the carrying amounts of the investment properties rise more sharply than projected cash flows, reducing the difference (headroom) between the value in use and the carrying amount of the groups of cash-generating units. In financial year 2021, the appreciation of investment properties and the associated increase in the carrying amounts of all groups of cash-generating units in the Rental segment resulted in a reduction in any available headroom for goodwill. Financial year 2021 saw total goodwill impairment of EUR 3,384.1 million for four of the six total regional business areas.

There is a risk for the consolidated financial statements that the amount of existing impairment was not appropriately calculated. There is also a risk that the related disclosures in the notes to the consolidated financial statements are inappropriate.

Our Audit Approach

In collaboration with our valuation specialists, we assessed the appropriateness of Vonovia’s material assumptions and the calculation methods for both ad hoc and annual impairment testing.

We satisfied ourselves that the future cash flows presented in the model and used in the calculation are appropriate, in part by comparing these with the latest projected figures from the detailed planning produced by Vonovia. We also checked that the detailed planning was correctly derived from the five-year plan adopted by the Management Board and acknowledged by the Supervisory Board. In addition, we obtained an understanding of the process of preparing the plans and evaluated the planning process. We also assessed the plausibility of the planning assumptions by way of sector-specific market expectations. Furthermore, we assessed the forecast quality of previous planning by comparing planned figures with actual figures and analyzing discrepancies.

As a significant portion of the value in use in the regional business areas in the Rental segment results from projected cash flows for the period after the detailed planning period (perpetual annuity phase), we assessed, in particular, the maintenance and the long-term growth rates recognized in the perpetual annuity phase in view of regional differences for the individual business areas and using external market expectations.

As regards the WACC calculated by Vonovia, we assessed the content of the individual assumptions and data on the basis of available market data and made a critical overall assessment compared to peer group companies in the real estate sector. Given the material impact of even minor changes in the WACC, we also focused on the sensitivity analyses conducted by ­Vonovia and ascertained whether and to what extent a change in the individual WACC assumptions and data would result in the need for further impairment within expected ranges.

To assess whether the valuation methods are applied properly in methodological and mathematical terms, we reproduced the valuation carried out by ­Vonovia using our own calculations and analyzed discrepancies.

Finally, we assessed whether the notes on goodwill impairment are appropriate. This also included assessing the appropriateness of the notes on sensitivities for reasonably possible changes in material assumptions and data used for the valuation.

Our Conclusions

The valuation method used for goodwill impairment testing is suitable and in line with the applicable measurement principles. The company’s assumptions and data used for the valuation are within acceptable ranges. The notes in relation to the goodwill impairment testing are appropriate.

Deutsche Wohnen SE acquisition

Regarding the accounting policies applied, please see the notes to the consolidated financial statements item 3. Disclosures on the acquisition of Deutsche Wohnen SE can be found in the notes to the consolidated financial statements under item 4.

Risk for the Financial Statements

­Vonovia SE acquired a total of around 87.6% of shares in Deutsche Wohnen SE in financial year 2021 as part of a public takeover bid, through purchases on the market and through individual agreements.

The transaction is a business combination achieved in stages, as ­Vonovia SE already had significant influence over Deutsche Wohnen SE prior to the public takeover bid announced in August 2021 as a result of share purchases. Following the purchase of further shares and the shares tendered as part of the public takeover bid, since September 30, 2021 (acquisition date) ­Vonovia SE has controlled Deutsche Wohnen SE and its direct and indirect subsidiaries (Deutsche Wohnen). Accordingly, the Deutsche Wohnen subgroup is consolidated in Vonovia’s consolidated financial statements from this date.

The total consideration as at the acquisition date is EUR 18.0 billion. Accounting for the net assets acquired of EUR 15.3 billion and the non-controlling interests of EUR 2.0 billion calculated as part of the purchase price allocation, which was still preliminary as at December 31, 2021, goodwill comes to EUR 4.7 billion.

Net assets are the difference between the assets acquired and the liabilities assumed, which are generally recognized at fair value on the acquisition date in accordance with IFRS 3. ­Vonovia sought the assistance of an independent expert to identify and measure the assets acquired and liabilities assumed.

Identifying and measuring the assets acquired and liabilities assumed is complicated and, in some cases, is based on discretionary assumptions by the Management Board. Especially when calculating the fair values of assets acquired and liabilities assumed, the Management Board must make judgments regarding the assumptions included in the valuation. Material assumptions chiefly relate to future cash flows and the discount rates.

There is a risk for the consolidated financial statements that the assets acquired and liabilities assumed are incorrectly identified or measured. There is also a risk that the disclosures in the consolidated financial statements are not complete and appropriate.

Our Audit Approach

We first obtained an understanding of the transaction, operating activities and the economic and legal environment of Deutsche Wohnen by interviewing the Management Board and other relevant points of contact at ­Vonovia and by assessing the public takeover bid and other contracts and agreements.

Based on our sector expertise and the findings gained regarding operating activities and the legal environment of Deutsche Wohnen, we evaluated the process of identifying the assets acquired and liabilities assumed in terms of compliance with the requirements under IFRS 3.

We also interviewed the external experts and assessed their approach to identifying the assets acquired and liabilities assumed that were subject to fair value measurement. We analyzed the overview prepared by the external experts with the assets and liabilities identified and to be measured regarding their completeness. As part of this, we compared the findings of the external expert with our own findings and expectations. In addition, we assessed the competence, capability and objectivity of the independent expert commissioned by Vonovia.

We evaluated the valuation of the identified assets acquired and liabilities assumed on a risk-oriented basis in collaboration with our valuation specialists.

This included assessing the appropriateness of the valuation process and the material assumptions and data used in the valuation. We discussed the future cash flows and discount rates used for the assumptions and data with those responsible for planning and compared these with our own assumptions and publicly available data.

Finally, we assessed whether the notes on the acquisition of Deutsche Wohnen are complete and appropriate.

Our Conclusions

The process of identifying and measuring the assets acquired and liabilities assumed is appropriate and in line with the applicable accounting principles. The material assumptions and data are appropriate, as is the presentation in the notes to the consolidated financial statements.

Appropriate inclusion of the QUARTERBACK Group and QUARTERBACK property companies in Vonovia’s consolidated financial statements in accordance with the equity method

Please see the explanations in the notes to the consolidated financial statements in section 30 for information on the inclusion of the QUARTERBACK Group and the QUARTERBACK property companies in Vonovia’s consolidated financial statements.

Risk for the Financial Statements ­­

Vonovia holds a 40% interest in QUARTERBACK Immobilien AG, Leipzig, the parent company of the QUARTERBACK Group. ­Vonovia also has another 11 investments in QUARTER­BACK property companies ranging from 44% to 50%. The QUARTERBACK Group is the other major shareholder. The QUARTERBACK Group and the QUARTERBACK property companies are consolidated in Vonovia’s consolidated financial statements as at December 31, 2021 in accordance with the equity method. As at the reporting date, the equity carrying amount carried forward for the QUARTERBACK Group and the QUARTERBACK property companies totaled EUR 475.2 million and total income of EUR 3.7 million from the equity accounting of the QUARTERBACK Group and the QUARTERBACK property companies was recognized in the consolidated income statement for the period October 1 to December 31, 2021.

In the financial year, the following transactions were conducted with the QUARTERBACK Group and individual QUARTERBACK property companies:

• Shareholder loan granted by Vonovia
• Sale of a project management company to the QUARTERBACK Group
• Agreement of contracts for future acquisitions of project real estate by Vonovia
• Agreement of service contracts

There were also personnel changes for the QUARTERBACK Group.

The decision as to whether it is appropriate to include the QUARTERBACK Group and the QUARTERBACK property companies in accordance with equity method is made chiefly by referring to the regulations in IAS 28, IFRS 11 and IFRS 10.

There is a risk for the financial statements that, given the complexity of the issue, it is not appropriate to include the QUARTERBACK Group and the QUARTERBACK property companies in Vonovia’s consolidated financial statements in accordance with the equity method.

Our Audit Approach

To assess the appropriateness of including the QUARTERBACK Group and the QUARTERBACK property companies in Vonovia’s consolidated financial statements in accordance with the equity method, we took a risk oriented-approach and focused chiefly on the following audit procedures:

• Obtaining an understanding of the preparation of the consolidated financial statements and assessing the set-up and form of internal controls identified, in particular regarding the accuracy and completeness of the information on which the decision on inclusion is made.
• Interviewing members of management at ­Vonovia and QUARTERBACK Immobilien AG, QUARTERBACK Immobilien AG’s auditor and other points of contact.
• Analyzing the contracts concluded, including regarding their substance and whether the conditions are in line with normal market conditions.
• Assessing the impact of the personnel changes on potential changes in influence.

Reviewing the overall analysis prepared by ­Vonovia on the at-equity inclusion of the QUARTERBACK Group and the QUARTERBACK property companies to ensure that all relevant matters are appropriately assessed and fully taken into account.

Our Conclusions

It is appropriate to include the QUARTERBACK Group and QUARTERBACK property companies in Vonovia’s consolidated financial statements in accordance with the equity method.

Other Information

Management and/or the Supervisory Board are/is responsible for the other information. The other information includes the following components of the combined management report, the content of which has not been audited:

• the non-financial statement, which is included in its own section of the combined management report and
• the corporate governance statement, which is referenced in the combined management report.

The other information also includes the other parts of the annual report.

The other information does not include the consolidated financial statements, the combined management report information audited for content and our auditor’s report thereon.

Our opinions on the consolidated financial statements and on the combined management report do not cover the other information, and consequently we do not express an opinion or any other form of assurance conclusion thereon.

In connection with our audit, our responsibility is to read the other information and, in so doing, to consider whether the other information stated above

• is materially inconsistent with the consolidated financial statements, with the combined management report information audited for content 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.

In accordance with our engagement letter, we conducted a separate audit of the non-financial statement. Please see our audit report dated March 16, 2022 for information on the nature, extent and results of this audit.

Responsibilities of Management and the Supervisory Board for the Consolidated Financial Statements and the Combined Management Report

Management is responsible for the preparation of the consolidated financial statements that comply, in all material respects, with IFRSs as adopted by the EU and the additional requirements of German commercial law pursuant to Section 315e (1) HGB and that the consolidated financial statements, in compliance with these requirements, give a true and fair view of the assets, liabilities, financial position, and financial performance of the Group. In addition, management is responsible for such internal control as they have determined necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability to continue as a going concern. They also have the responsibility for disclosing, as applicable, matters related to going concern. In addition, they are responsible for financial reporting based on the going concern basis of accounting unless there is an intention to liquidate the Group or to cease operations, or there is no realistic alternative but to do so.

Furthermore, management is responsible for the preparation of the combined management report that, as a whole, provides an appropriate view of the Group’s position and is, in all material respects, consistent with the consolidated financial statements, complies with German legal requirements, and appropriately presents the opportunities and risks of future development. In addition, management is responsible for such arrangements and measures (systems) as they have considered necessary to enable the preparation of a combined management report that is in accordance with the applicable German legal requirements, and to be able to provide sufficient appropriate evidence for the assertions in the combined management report.

The Supervisory Board is responsible for overseeing the Group’s financial reporting process for the preparation of the consolidated financial statements and of the combined management report.

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements and of the Combined Management Report

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 whether the combined management report as a whole provides an appropriate view of the Group’s position and, in all material respects, is consistent with the consolidated financial statements and the knowledge obtained in the audit, complies with the German legal requirements and appropriately presents the opportunities and risks of future development, as well as to issue an auditor’s report that includes our opinions on the consolidated financial statements and on the combined management report.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Section 317 HGB and Regulation (EU) No. 537/2014 and in compliance with German Generally Accepted Standards for Financial Statement Audits promulgated by the Institut der Wirtschaftsprüfer (IDW) as well as the ISA will always detect a material misstatement. 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 and this combined management report.

We exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements and of the combined management report, 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 opinions. 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 controls.
• Obtain an understanding of internal control relevant to the audit of the consolidated financial statements and of arrangements and measures (systems) relevant to the audit of the combined management report 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 these systems.
• Evaluate the appropriateness of accounting policies used by management and the reasonableness of estimates made by management and related disclosures.
• Conclude on the appropriateness of management’s 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 the auditor’s report to the related disclosures in the consolidated financial statements and in the combined management report or, if such disclosures are inadequate, to modify our respective opinions. 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 be able 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 present the underlying transactions and events in a manner that the consolidated financial statements give a true and fair view of the assets, liabilities, financial position and financial performance of the Group in compliance with IFRSs as adopted by the EU and the additional requirements of German commercial law pursuant to Section 315e (1) HGB.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express opinions on the consolidated financial statements and on the combined management report. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our opinions.
• Evaluate the consistency of the combined management report with the consolidated financial statements, its conformity with [German] law, and the view of the Group’s position it provides.
• Perform audit procedures on the prospective information presented by management in the combined management report. On the basis of sufficient appropriate audit evidence we evaluate, in particular, the significant assumptions used by management as a basis for the prospective information, and evaluate the proper derivation of the prospective information from these assumptions. We do not express a separate opinion on the prospective information and on the assumptions used as a basis. There is a substantial unavoidable risk that future events will differ materially from the prospective information.

We communicate with those charged with governance 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.

We issue a declaration to those responsible for monitoring stating that we comply with the relevant independence requirements and discuss with them all relationships and other matters that may reasonably be assumed to affect our independence, and the safeguards in place to prevent this.

Of the issues that we have discussed with those responsible for monitoring, we determine the issues that were the most significant in the audit of the consolidated financial statements for the current period under review and therefore represent the particularly important audit issues. We describe these issues in the auditor’s report, unless the law or other regulations state that they must not be publicly disclosed.

Other statutory and legal requirements

Report on the Audit of the Electronic Reproduction of the Consolidated Financial Statements and the Combined Management Report for the Purpose Of Disclosure Under Section 317 (3a) HGB

In accordance with Section 317 (3a) HGB, we conducted a reasonable assurance audit as to whether the reproductions of the consolidated financial statements and the combined management report contained in the available file „2022-03-14 - Testatsdatei.zip“ (SHA256-Hash value: 12a811e93a30caf5f72f9d86e64171835d8aaf7cf85828f304c09163c602df4b) and prepared for the purpose of disclosure (hereinafter also referred to as “ESEF documents”) comply, in all material respects, with the provisions of Section 328 (1) HGB regarding electronic reporting formats (“ESEF format”). In line with German legal requirements, this audit extends only to converting the information in the consolidated financial statements and the combined management report to ESEF format and thus not to the information included in these reproductions or information in the above file.

In our opinion, the reproductions of the consolidated financial statements and the combined management report contained in the above file and prepared for the purpose of disclosure comply, in all material respects, with the provisions of Section 328 (1) HGB regarding the electronic reporting format. Other than these audit opinions and the audit opinions included in the above “Report on the audit of the consolidated financial statements and the combined management report” on the attached consolidated financial statements and combined management report for the financial year from January 1 to December 31, 2021, we do not express any audit opinion on the information included in these reproductions or on the other information included in the above file.

We audited the reproductions of the consolidated financial statements and the combined management report included in the above file in accordance with Section 317 (3a) HGB, taking into account the IDW Auditing Standard: Audit of electronic reproductions of financial statements and management reports produced for the purpose of disclosure in accordance with Section 317 (3a) HGB (IDW PS 410) (October 2021) and the International Standard on Assurance Engagements 3000 (Revised). Our responsibility in this context is further described below. Our audit practice applied the requirements for quality assurance systems set out in the IDW Assurance Standard: quality assurance requirements in audit practice (IDW QS 1).

The company’s management is responsible for preparing the ESEF documents containing the electronic reproductions of the consolidated financial statements and the combined management report in accordance with Section 328 (1) sentence 4 no. 1 HGB and for marking up the consolidated financial statements in accordance with Section 328 (1) sentence 4 no. 2 HGB.

In addition, the company’s management is responsible for such internal control as they have determined necessary to enable the preparation of ESEF documents that are free from material breaches of the provisions of Section 328 (1) HGB regarding the electronic reporting format, whether due to fraud or error.

The Supervisory Board is responsible for overseeing the process for the preparation of the ESEF documents as part of the financial reporting process.

Our objectives are to obtain reasonable assurance about whether the ESEF documents are free from material breaches of the provisions of the requirements of Section 328 (1) HGB, whether due to fraud or error. We exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of breaches of the requirements of Section 328 (1) HGB, 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 opinions.
• Obtain an understanding of the internal control relevant to the audit of the ESEF documents to plan audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of this control.
• Assess the technical validity of the ESEF documents, i.e. whether the file provided that contains the ESEF documents complies with the requirements regarding the technical specification for this file as set out in the Commission Delegated Regulation (EU) 2019/815 in the version valid at the end of the reporting period.
• Assess whether the ESEF documents allow an identical XHTML reproduction of the audited consolidated financial statements and the audited combined management report.
• Assess whether the markup of the ESEF documents using Inline XBRL technology (iXBRL) allows for an appropriate and complete machine-readable BRL copy of the XHTML reproduction in accordance with Articles 4 and 6 of the Commission Delegated Regulation (EU) 2019/815 in the version valid at the end of the reporting period.

Other Disclosures In Accordance With Article 10 Regulation (EU) No. 537/2014

We were elected as group auditor by the Annual General Meeting on April 16, 2021. We were engaged by the Supervisory Board on December 15, 2021. We have been ­Vonovia SE’s group auditor continuously since the company’s initial public offering in the 2013 financial year.

We declare that the audit opinions expressed in this auditor’s report are consistent with the additional report to the Audit Committee in accordance with Article 11 Regulation (EU) No. 537/2014 (audit report).

Other matters – use of the auditor’s report

Our auditor’s report is always to be read in connection with the audited consolidated financial statements, the audited combined management report and the audited ESEF documents. The consolidated financial statements and combined management report converted into ESEF format – including the versions to be published in the German Federal ­Gazette – are simply electronic reproductions of the audited consolidated financial statements and the audited combined management report and do not replace them. In particular, the ESEF report and our audit opinions contained therein are to be used only in conjunction with the audited ESEF documents provided in electronic form.

Public auditor responsible

The public auditor responsible for the audit is Maximilian Cremer.

Dusseldorf, March 16, 2022

KPMG AG
Wirtschaftsprüfungsgesellschaft
[Original German version signed by:]