Asseco Poland S.A.

Annual Report

Annual Report for the year ended December 31, 2016

937 mPLN in sales revenues for 2016

352 mPLN 250 mPLN in net profit paid out in dividends for 2016 for 2015

th 2,576 27 mPLN 6 highly committed of income tax paid largest software employees in Poland in 2016 vendor in Europe

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największy dostawca oprogramowania Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

President’s Letter

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

In the previous year, we continued cooperation with majority of our key customers and were developing PRESIDENT’S LETTER our flagship products for the financial and general business sectors. In the banking sector, we continued cooperation with the largest commercial banks in Poland, implemented our flagship banking system def3000 for further customers from the cooperative banking sector and launched the omnichannel mobile platform for Asseco CBP banking in Raiffeisen Polbank. We believe that our modern products implemented in the Polish banking sector will allow us to effectively compete in the foreign financial markets in the near future.

In spite of difficult environment in 2016, our operations in the public institutions sector fared well thanks to our effective strategy of long-term cooperation with our key customers. We extended a contract for the maintenance of the largest IT system in Poland – the Comprehensive Information System (CIS) in the Social Insurance Institution (ZUS) – until the middle of 2018. We also continued cooperation with other partners, such as the Ministry of Finance or the Agricultural Social Insurance Fund (KRUS). In the field of defense and security, we continued preparations for the process of modernization and digitalization of the Polish Army, initiated by the Ministry of National

Defense. We extended our competences and implemented systems for our existing customers, such as the European Space Agency. Dear Shareholders, It is my pleasure to present to you the report on In the general business sector, after the period of business operations of Asseco Poland for the year implementation works in the previous years, our 2016. It was a challenging year, during which we specialists focused on maintaining systems in the worked on implementing our long-term strategy aimed largest companies in the energy sector. We also at creating new value and on further developing the continued works on developing the billing system in Company. Ethiopia. We successfully completed the migration of 3 million customers of Orange operator to a new system After a period of strong growth of the Company and began a cooperation on centralizing the system of through acquisitions, the previous year was marked by Polkomtel mobile operator with the systems of organizing our structure in Poland and reorganizing our Cyfrowy Polsat. operations. As part of these steps, we have separated the infrastructure and general business divisions from On behalf of myself and the whole management team, Asseco Poland and transferred them to two companies I would like to cordially thank all the people who from Asseco Group: Asseco Data Systems contributed to the continued process of building of and DahliaMatic. After the changes, Asseco Poland will a powerful and modern IT company of Asseco Poland. focus on supplying proprietary software and services to the financial sector, large companies and the central With best regards, administration. Adam Góral President of the Management Board Asseco Poland S.A

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Management Report on Operations of Asseco Poland S.A.

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

MANAGEMENT REPORT ON OPERATIONS OF ASSECO POLAND S.A. for the year ended December 31, 2016 PRESIDENT’S LETTER ...... BŁĄD! NIE ZDEFINIOWANO ZAKŁADKI. GENERAL INFORMATION ON ASSECO POLAND S.A...... 8

COMPANY’S AUTHORITIES ...... 9 Management Board...... Błąd! Nie zdefiniowano zakładki. Supervisory Board ...... 11 Awards and accolades ...... 12

INFORMATION TECHNOLOGY MARKET AND ITS FUTURE OUTLOOK ...... 13

STRATEGY AND DIRECTIONS OF DEVELOPMENT ...... 15 Target markets ...... 16 Product portfolio ...... 18

FINANCIAL INFORMATION ...... 19 Reorganization of Asseco Poland S.A...... 19 Financial results ...... 20 Cash flow ...... 23 Statement of financial position ...... Błąd! Nie zdefiniowano zakładki. Non-recurring events with impact on our financial performance...... 25 Opinion on feasibility of investment plans ...... 26 Asseco Poland S.A. in the capital market ...... 26 Shareholder structure ...... 27 Remuneration policy report ...... 28 Discussion of significant risk factors and threats ...... 30 OTHER INFORMATION ...... 33 Explanation of differences between the financial results disclosed in the annual report and previous financial forecasts for the year...... 33 Opinion on feasibility of the Management Board financial forecasts for 2016 ...... 33 Changes in the Company management policies ...... 33 Remuneration of the management and supervisory personnel ...... 33 Description of the Company’s sponsoring and charity policy ...... 33 Agreements concluded by Asseco Poland S.A. with its management personnel providing for payment of compensations if such persons resign or are dismissed from their positions...... 33 Information on the agreements known to the Issuer which may result in future changes of the equity interests held by the existing shareholders and bondholders ...... 33 Organizational and equity relationships...... 33 Related party transactions ...... 33 Bank loans, borrowings, sureties and guarantees ...... 33 Loans granted during the financial year ...... 34 Off-balance-sheet items ...... 34 Utilization of proceeds from issuance of shares ...... 34 Monitoring of employee stock option plans ...... 34 Significant agreements concluded by the Company ...... 34 Information on judicial proceedings where the value in dispute exceeds 10% of the amount of equity ...... 34 Information on adhering to the corporate governance standards ...... 34 Agreement with the entity authorized to audit financial statements...... 34 Remuneration of the entity authorized to audit financial statements ...... 34

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

MANAGEMENT REPORT ON OPERATIONS OF ASSECO POLAND S.A. for the year ended December 31, 2016 This Management Report on Operations has been approved for publication by the Management Board of Asseco Poland S.A. on March 16, 2017. Management Board:

President

Adam Góral of the Management Board

Vice President

Przemysław Borzestowski of the Management Board

Vice President

Tadeusz Dyrga of the Management Board

Vice President

Krzysztof Groyecki of the Management Board

Vice President

Rafał Kozłowski of the Management Board

Vice President

Marek Panek of the Management Board

Vice President

Paweł Piwowar of the Management Board

Vice President

Zbigniew Pomianek of the Management Board

Vice President

Przemysław Sęczkowski of the Management Board

Vice President

Robert Smułkowski of the Management Board

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

GENERAL INFORMATION ON ASSECO POLAND S.A.

Asseco Poland S.A. Asseco Poland S.A. (the “Company”, “Asseco”) is the largest Polish information technology company listed on the Warsaw Stock Exchange (WSE ticker: ACP).With a market capitalization amounting to about PLN 4.5 billion (about EUR 1.0 billion), the Company is included in the prestigious WIG20 index. It is also the largest company listed in the IT industry index WIG- Informatyka. Asseco Poland plays a key role in Asseco Group and is a unique combination of a software house and a service provider.The Company is a producer of state- of-the-art software that supports mission-critical business processes of enterprises in all key sectors of the Polish economy.Asseco’s software applications are used by more than half of Polish banks, the largest insurance, energy and telecommunications companies, miscellaneous healthcare institutions, local and central public administration bodies, as well as by the uniformed services. Over the twenty years of persistent implementation of our development strategy, which focuses on gaining expertise and development of proprietary software, we have become a leader in the Polish information technology market and accumulated the necessary potential to build a global company.

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Company’s authorities MANAGEMENT BOARD

Adam Góral President of the Management Board

responsible for the development vision and strategy of Asseco Group.

Przemysław Borzestowski Tadeusz Dyrga Vice President of the Management Vice President of the Management Board Board

responsible for Public Administration responsible for Social Insurance Division, Capital Market Division, Division, Healthcare Systems Division, and Office for Protection of and Systems Maintenance Division. Non-Public Information.

Rafał Kozłowski Krzysztof Groyecki Vice President of the Management Vice President of the Management Board Board

Chief Financial Officer responsible for responsible for Healthcare Division. Finance Division of Asseco Group,

and Logistics Department.

Paweł Piwowar Marek Panek Vice President of the Management Vice President of the Management Board Board

responsible for Energy and Gas responsible for Development Division Industry Division, of Asseco Group, and EU Projects Telecommunications and Media Office. Division, and Enterprises Division.

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Zbigniew Pomianek

Vice President of the Management Przemysław Sęczkowski Board Vice President of the Management Board responsible for Commercial Banks Division, Cooperative Banks Division, responsible for Public and Investor Business Intelligence Division, Relations Department, and Compliance Department, and Marketing Department. Maintenance and Development of Back-Office Systems Department.

Robert Smułkowski Vice President of the Management Board

responsible for PKO Bank Division.

During the period of 12 months ended December 31, 2016, the Company’s Management Board was composed of the following persons:

Management Board Period of service Adam Góral 01.01.2016 – 31.12.2016 Przemysław Borzestowski 01.01.2016 – 31.12.2016 Andrzej Dopierała 01.01.2016 – 30.06.2016 Krzysztof Groyecki 01.06.2016 – 31.12.2016 Tadeusz Dyrga 01.01.2016 – 31.12.2016 Rafał Kozłowski 01.01.2016 – 31.12.2016 Marek Panek 01.01.2016 – 31.12.2016 Paweł Piwowar 01.01.2016 – 31.12.2016 Zbigniew Pomianek 01.01.2016 – 31.12.2016 Włodzimierz Serwiński 01.01.2016 – 31.03.2016 Przemysław Sęczkowski 01.01.2016 – 31.12.2016 Robert Smułkowski 01.01.2016 – 31.12.2016

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

SUPERVISORY BOARD

Jacek Duch Chairman of the Supervisory Board

Adam Noga Piotr Augustyniak Vice Chairman of the Supervisory Member of the Supervisory Board Board

Dariusz Brzeski Artur Kucharski Member of the Supervisory Board Member of the Supervisory Board

During the period of 12 months ended December 31, 2016, the Company’s Supervisory Board was composed of the following persons:

Supervisory Board Period of service Jacek Duch 01.01.2016 – 31.12.2016 Adam Noga 01.01.2016 – 31.12.2016 Piotr Augustyniak 01.01.2016 – 31.12.2016 Dariusz Brzeski 01.01.2016 – 31.12.2016 Artur Kucharski 01.01.2016 – 31.12.2016 Dariusz Stolarczyk 01.01.2016 – 28.04.2016

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Awards and accolades the Book of Lists compiled by Warsaw Business Journal. This report contains information on 1600+ companies from various business sectors, including consulting, advertising, telecommunications, information

technology, and real estate. Asseco has been listed in the Top 5 in 19 categories of the Computerworld TOP 200 report. Asseco has proved to be the best in 8 categories, thereby improving the result from the previous year. Asseco has maintained its leading position in the ranking of IT companies with the Asseco has received the title largest R&D expenditures. The company continues to be of the "Pearl of the Polish the largest provider of IT solutions and services for the Economy" in the category of Public Administration and Healthcare sectors. In Large Pearls, which included addition, Asseco has been listed as the number 1 among companies with revenues over PLN 1 billion. The providers of IT maintenance services, suppliers of company has received the title from the Polish Market customer-tailored software and providers of IT services magazine and the Department of Support and Decision for large companies and corporations. In turn, Asseco Analysis of the Warsaw School of Economics. The Group has become a leader among the largest IT capital company has taken third place in the ranking of Polish groups. companies.

Asseco has won in the main Asseco has been awarded in IT@Bank ranking, prepared by the “Polish Company – Miesięcznik Finansowy International Champion” Bank.The company has topped competition. Asseco has the "Efficiency" category and been again awarded in the has taken second place in the "Position of Companies in “Polish Company – International Champion” the Cooperative Banking Sector" category. Asseco has competition, in the “Investor" category. Among the maintained leading positions in several categories of the winners there were companies which carry out ranking for the consecutive year. extensive export activities and are successful on foreign markets. The competition is organized by PwC and Puls Biznesu, with the honorary patronage of the Ministry of Asseco Customer Banking Development and the Ministry of Foreign Affairs. Platform solution has been awarded the title and the recommendation of the "Hit of Asseco has been awarded 2016" in the technology the title od the best competition organized by Gazeta company in the 2nd edition Bankowa.In addition, in the of the "CEE Capital "Leader of 2015" ranking, in the category of energy, fuel MarketsAwards" and chemicals, Tauron Obsługa Klienta has taken competition. The choice has been made by the jury second place for the centralization of billing systems for which included, among others, investors, bankers and mass clients. Under that project, the company, in journalists. They have appreciated the role of the cooperation with Asseco Poland, has implemented the company as a leader in dynamic changes in the capital Asseco Utility Management Solutions system. markets in the region of Central and Eastern Europe. The competition has included companies from Poland, Romania, Ukraine, Hungary, the Czech Republic, Book of Lists – Book of Lists – Lithuania, Estonia, Bulgaria, Croatia, Germany and No. 1 in the category of Slovenia. “Software Producer”. Our victory in the annual ranking of

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

IT MARKET AND ITS OUTLOOK Development prospects of the global IT market Among banks and financial institutions, the spending on technology is determined by intense fight for the According to Gartner’s forecasts, in 2017, the global IT customer and competition, in which modern solutions industry will grow by 2.7% to reach the total value of play a very important role. This phenomenon, USD 3,464 billion.Concurrently, according to these supporting the demand for IT services, is partially same experts, in 2016 the market recorded adecline offset by the need for cost savings and a conservative by 0.6%, which was caused primarily by lower sales of financial policy of these institutions. hardware and communication services. It is worth noting that according to Gartner, the growth of the IT According to market research, cloud and SaaS market in the EMEA region – Europe, Middle East and solutions, although still representing small part of the Africa – reached 0.6% in 2016 and will accelerate to IT market, will grow particularly dynamically in the 1.9% in 2017. near term. These solutions are particularly attractive to small and mid-sized companies, which can gain IT Market in Poland access to more advanced solutions with relatively According to the latest report prepared by PMR, lower costs. The growing importance of products published in September 2016, the Polish information from that market area will be one of the factors and communication technologies market is growing at enhancing the need for the expansion of data centers the stable rate of 4-5% per year, boosted by Poland’s - another rapidly growing sector of the IT market in GDP growth, which, despite slight slowdown to 2.8% Poland. in 2016 from 3.6% in 2015, is still higher than in other Company’s market position European countries. The Polish IT sector is a competitive and diversified According to PMR, the Polish IT market should grow market consisting of both local and leading global by 4.1% in 2016 versus 4.2% in 2015. Software and IT companies. Asseco Poland S.A. is one of the largest IT services will be the growth engine in the market, but companies in Poland and the largest company in the the situation will be more difficult in the computer country focused on the sales of proprietary software hardware market, where a drop in the sales of PCs and services, and not computer hardware. and peripherals is forecast. That will force many distributors to change their strategies and enter new According to the latest available estimates of product segments. The value of the whole market is COMPUTERWORLD TOP200, Asseco Poland ranked estimated at PLN 34 billion. 12th in the category of the “Largest IT companies operating in Poland”. However, it is worth noting that Situation in the public administration segment all companies which have ranked higher than Asseco According to estimates of market research Poland are producers of computer hardware or companies, the public administration remains one of companies whose share of hardware in sales exceeds the leading recipients of services from the IT industry. 60%. Therefore, the situation in this sector has a significant IT companies with highest net Net profit (in millions of impact on the situation in the whole services and profit in 2015 PLN) software market. 2016 did not bring the expected CD Projekt 336.2 increase in orders from the public administration, Asseco Poland 257.1 which, as the PMR’s study indicates, is one of the key ABC Data 60.3 challenges for the development of some companies in Comarch 57.7 the sector. Currently, in line with market AB 54.3 expectations, an increase in public orders related to Ericpol 51.3 the absorption of EU funds is expected in the second Asseco Business Solutions 33.5 half of 2017. Source: COMPUTERWORLD TOP200 2016, Ranking of IT and telecom companies by net profit generated in 2015. Situation in the financial and general business Concurrently, Asseco is the second-largest capital segments group and the second-largest IT company in Poland in The economic growth contributes to increasing terms of net profit. Asseco is also the biggest R&D spending on software and IT services by the general spender in this market. It is also worth noting that business sector. This trend is clearly visible among another company from the Asseco Group - Asseco smaller and mid-sized companies whose IT needs Business Solutions – holds 7th position in the rank in grow along with the scale of their operations and terms of profitability. drive demand for ERP solutions.

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Asseco Poland's leading market position is confirmed by the next table, which presents the positions taken by the Company in the COMPUTERWORLD TOP200 ranking that compares leading companies operating in the Polish market by type of business. Asseco Poland is a clear leader in the category of customer- tailored software and IT services for the business sector.

Ranking Ranking position Producers of customer-tailored software 1 Providers of IT maintenance services 1 Providers of IT services 1 Providers of system integration services 5 Source: COMPUTERWORLD TOP200 2016, Ranking of IT and telecom companies by sales revenues generated in 2015.

In terms of sectors, Asseco Poland is the leader or one of the leading suppliers in the key segments of its business. A drop to 8th position in the ranking of financial institutions is a result of the sales of the insurance competence center to Israeli subsidiary Sapiens in July 2015. Positions in individual segments are presented below:

Ranking of providers of software and Ranking services to the sector of position Public administration 1 Healthcare 1 Large companies and corporations 2 Banking 3 Energy industry 2 Financial institutions 8 Telecommunications 5 Source: COMPUTERWORLD TOP200 2016, Ranking of IT and telecom companies by sales revenues generated in 2015.

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Strategy and directions of development Mission international affiliated companies to create a comprehensive portfolio of products satisfying the Our mission is to build a reliable and profitable, global highest needs of its customers. information technology company providing high quality software and services. The activities of Asseco Poland S.A. focus on providing a wide range of proprietary IT solutions and services. Values of Asseco Poland – our Source Code The Company specializes in implementing the largest Asseco Poland has come up with its own “source and most complex IT projects in Poland, offering code” that lists the common values shared by Asseco comprehensive solutions to all sectors of the employees. These values have been devised by all of economy, and also selling standardized products to our employees and are recorded in a formal smaller entities. The Company builds long-term trust- document, which is effective across our organization. based relationships with customers, becoming their strategic business partner. Commitment One of the elements of organic growth is increasing We are fully committed to each and every project and integration of departments with similar or identical the success of our Clients is our greatest satisfaction. competences. That allows the Company to increase Respect efficiency and improve its offer to customers. In 2016, these processes were manifested in integrating the We require trust, honesty and mutual respect both infrastructure operations in subsidiary Asseco Data from ourselves and from others. Systems and transferring departments implementing Quality third-party solutions to company DahliaMatic. We always maintain high quality standards in all of Apart from operating activity, Asseco Poland S.A., as our activities. the owner controlling other companies in Asseco Group, plays a key role in the Group. Asseco sets Professionalism strategic directions of development of the Group, We continually upgrade our qualifications and are monitors and supervises their implementation, sets willing to share experience. internal policies for the Group's functioning and regulates the relationships between entities which Effectiveness are part of the federation. We are ambitious and consistent in striving to achieve Expansion through acquisitions our goals. Asseco Poland S.A. has been pursuing successful Responsibility acquisition policy in Poland and abroad for many We take full responsibility for our work and years, ranking among the most experienced environment in which we operate. companies in this field in Poland. Since 2004, the Strategy Company has concluded over 60 purchase transactions, repeatedly increasing the scale of its The foundation of the strategy of Asseco Poland SA is operations and geographic reach. providing proprietary software and IT services to business customers and public administration. The Above all, the company is interested in profitable entities with committed and highly-specialized strategy of Asseco Poland is based on two pillars.The employees willing to further develop themselves by first is organic growth which is achieved through proprietary software and services, whereas the connecting to a unique federation model of Asseco or second one involves expansion through acquisitions. integrating with Asseco Poland S.A.. The purpose of acquisitions of Asseco is to increase competence in In 2017, the Company will continue its present approach. key sectors of activity, enter new geographic markets, or strengthen the position of the entire Asseco Group Organic growth in the countries where it has been already active. The strategy of organic growth of Asseco Poland S.A.is based on providing proprietary software and services to clients in Poland and abroad. Asseco strategy relies on sector-specific business expertise, which is supported by technological competence. In addition, Asseco leverages on the vast experience of its

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Target markets

Other General Business Other PLN 184 m PLN 10 m General Business 1% PLN 98.2 m 20% PLN 216.2 m 9% 20% Banking and Finance Banking and PLN 316.7 m Finane 34% PLN 305 m 28% 2016 2015 Public Administration Public PLN 426.1m Administration 45% PLN 472.4 m 43%

Asseco Poland is specialized in the development of Asseco Data Systems, which offers software to lease proprietary IT solutions for all sectors of the and factoring businesses. economy.Asseco’s product portfolio can be divided

into three main sectors: banking and finance, public administration and general business. Each of these ▪ Public Institutions sectors comprises a wide range of institutions that Asseco Poland is the largest IT provider for the public use proprietary IT systems, infrastructure as well as administration sector in the country. It supplies the third-party software delivered by Asseco Poland. largest and most complex projects at the central level, as well as smaller solutions at the local level and in the healthcare sector. ▪ Banking and Finance Central level - Asseco Poland develops and Production of banking software is one of the key implements software solutions for the public businesses of Asseco Poland. The Company continues administration in the areas that, due to their nature, to improve and further develop its IT solutions cannot be supported by ready-made tools. These are tailored to meet the banking sector’s growing mostly complex systems with powerful functionality expectations from information technology. suitable for processing of large data volumes. Asseco’s flagship product for the banking sector is the Thelargest information technology project in Poland – comprehensive IT suite called def3000 which is used the Comprehensive Information System of the Social by over a dozen financial institutions in Poland.In Insurance Institution (ZUS) – has been implemented addition, we offer dozens of specialized ready-to- by Asseco. Furthermore, Asseco developed the implement solutions, requiring only some adaptation Central Register of Vehicles and Drivers for the to specific operations of a particular institution.In Ministry of the Interior and Administration, order to meet the market expectations, Asseco Information System for the National Border Guard, as Poland has also developed modern e-banking and well as IT solutions for the Agency for Restructuring omnichannel solutions (Asseco Customer Banking and Modernization of Agriculture. Platform) as well as cloud products. As the only IT company of Central and Eastern Apart from the above-mentioned products and Europe, we executed over 50 prestigious projects for services provided for the banking sector, Asseco also the EU and NATO agencies, including the EU border offers comprehensive solutions supporting the protection system for the Frontex agency. Experience operations of brokerage houses and capital market gained during the implementation of projects for participants. The flagship product offered in this area international institutions allowed the Company to is Promak. After the reorganization carried out in move from the position of a service provider to the 2015 and 2016, other companies from the Asseco position of a supplier of solutions and products. Group offer specialized software to other segments of Over the past two years, the Company has invested in the financial sector - Israeli company Sapiens, which is the development of innovative solutions in the areas a competence center for the insurance sector, and of: unmanned platforms, examination and data

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

analysis, command support systems, satellite Asseco Poland has, for many years, been one of the solutions and cybersecurity. These investments are a key providers of billing systems to Orange Poland. Our response to the needs of both the Ministry of Defense software solutions are also used by other mobile of the Republic of Poland as well as foreign operators, such as T-Mobile and Polkomtel, as well as customers. These activities have been closely media companies. Moreover, our solutions are connected with the plans to increase the country's utilized by major energy holdings operating in Poland, defense budget and update the Plan of Technical such as Tauron and Enea. Modernization of the Polish army. Local Governments – In cooperation with other companies from Asseco Group, Asseco Poland provides proprietary IT solutions for all levels of local administration bodies. A significant advantage of our software is that it can be easily integrated with specialized tools such as digital maps or metropolitan networks. Healthcare – Asseco is an undisputed leader in the market of IT solutions for all types of medical facilities. Our solutions are used by hundreds of major hospitals and clinics across Poland. Asseco’s services include professional consulting on the design, implementation and maintenance of information systems for health insurance companies, and the provision of comprehensive solutions for hospitals and clinics. Asseco delivers patient service solutions, contract settlement systems as well as facility management solutions. In this sector, Asseco’s flagship product is AMMS (Asseco Medical Management Solution), a comprehensive package of information systems designed to help manage large and medium-sized hospitals, polyclinics, medical centers, outpatient clinics and emergency departments.

▪ General Business Asseco Poland offers comprehensive proprietary solutions that are capable of handling multi-million customer databases and are customized for the specific needs of telecommunication, media, energy, gas and utility enterprises. Over a 20-year long presence of our solutions in this sector resulted in strategic partnerships with many major enterprises which appreciate the in-depth professional knowledge and experience of our specialists and the flexibility of our solutions. Our product portfolio dedicated to the Telco&Utilities sector includes billing systems, fraud detection systems, sales and CRM applications, portal applications, data warehouses, BI tools, and many more.The product portfolio is supplemented with technical infrastructure and asset management systems, and GIS/NIS solutions.

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Product portfolio

Proprietary Proprietary software and software and services services PLN 872.5 m PLN 941.3 m 93% 86%

Other Other PLN 4.4 m 2016 PLN 3.3 m 2015 Third-party software Third-party PLN 44.7 m software 5% PLN 71.5 m Hardware 7% PLN 15.2 m PLN Hardware 2% PLN 75.7 m PLN 7%

Asseco Poland is focused on providing customers with international institutions from the sector. The AUMS proprietary solutions in the form of software and system has won recognition from the renowned services. Third-party software and IT equipment are research company Gartner which placed it in its provided only when necessary. As a result, the prestigious “Magic Quadrant” report for two years in Company offers its customers top-class solutions a row (2014 and 2015). In addition, Asseco's banking tailored to their needs. software def3000/TR won similar recognition in 2014. ▪ Dedicated solutions ▪ Standard software packages Asseco Poland is the most experienced Polish IT We also provide standard software packages for company when it comes to the execution of large- thousands of small and mid-sized companies.With no scale and complex IT projects, implemented to need for customer-tailored products and at an individual customer needs. A good example of affordable cost, firms can use Asseco’s out-of-the-box Asseco’s competence in this area is the IT project software to support their routine enterprise implemented for the Social Insurance Institution management functions. A good example of a (ZUS), the largest in the history of our country.The standard software package is mMedica – software Comprehensive Information System handles more dedicated to outpatient clinics and small hospitals. than 24 million unique accounts, 2 trillion ▪ Cloud computing solutions contributions and is used by over 30 thousand users on a daily basis.The Comprehensive Information Small and mid-sized enterprises can use our IT System of ZUS won the main prize in the “eEurope solutions available over the Internet. With a minimum Awards for eGovernment – 2005” competition, which of effort and cost and maximum benefits, our was organized by the European Institute of Public customers may take advantage of our knowledge and Administration (EIPA), working under the auspices of experience without investing large sums of money in the European Commission. The ZUS’s CIS was IT infrastructure or a team of IT experts. Major clients awarded for the creation of optimum environment for cloud-based e-banking systems delivered by for successful implementation of a public Asseco Poland are cooperative banks operating in administration project. Poland. ▪ Comprehensive solutions for business sectors We offer comprehensive IT packages that are customized to individual needs of large and mid-sized companies virtually from every sector of the economy. In this category, our product portfolio includes comprehensive systems dedicated to the banking sector (Asseco def3000), power industry (AUMS), healthcare (AMMS), as well as for brokerage houses (Promak). In recent years, Asseco's software has won recognitions and awards from local and

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

FINANCIAL INFORMATION Reorganization of Asseco Poland S.A. The results of Asseco Poland were affected by the public administration (health care and central level). reorganization of its business in Poland in 2016. The Asseco Data Systems focuses on infrastructure process was connected with the merger with solutions and local administration, and DahliaMatic is Infovide-Matrix (Regulatory FillingNo. responsible for the implementation of third-party 4,8,10,22/2016). solutions. The company's objective was to create competence Since the infrastructure division of Asseco Poland was centers by consolidating organizational units of similar a separate operating segment of significant relevance or identical business areas. As part of these changes, to the Company, the comparative data have been divisions dealing with implementation of third-party changed due to the recognition of discontinued software (SAP, Oracle, Microsoft) have been operations. In the period ended July 1, 2016, the transferred from Asseco Poland and Infovide-Matrix revenues of the infrastructure division amounted to to DahliaMatic. Divisions responsible for the banking, PLN 64.1 million, while in 2015, they amounted to energy and telecommunications sector have joined PLN 221.2 million. The detailed impact of this change Asseco Poland, while the infrastructure division has on the presented financial results is described in been transferred to Asseco Data Systems. paragraphs II.8 and IV of the financial statement of Asseco Poland for the period of 12 months ended As a result, Asseco Poland remains a competence December 31, 2016 center in the Polish part of the Group for large and mid-sized businesses, the financial sector and the .

Infrastructure Division Banking SAP Infrastruktury Energy Implementation Telecommunication Center

Business Division (SAP, Oracle, Microsoft)

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Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Financial results

Key operation data of Asseco Poland 2010-2016 1600 1400 1200 1000 800 600 400 200 0 2010 2011 2012 2013 2014 2015 2016

Revenues Proprietary software and services EBIT

In 2016, the Company recorded lower sales revenues ▪ Revenues than in 2015. That was mainly a result of slowdown in the settlement of the tenders in the public administration and healthcare sectors, as well as lower Other 1% scale of activity in the energy sector after the end of General Business the implementation contract for Tauron Polska Energia 20% Banking and Finance in 2015. 34% A drop in the sales of proprietary software and services - a key parameter from the point of view of the Company's strategy - was smaller than a decrease in 2016 the total sales revenues and reached 7.3%. Presented below are the operating results for the year Public Administration ended December 31, 2016 as well as for the 45% comparable period of the previous year:

12 months 12 months mPLN ended Dec. 31, ended Dec. 31, Change The revenues of Asseco Poland are well diversified 2016(audited) 2015 (audited) between three key segments of the Company’s activity – the public administration, the banking and Revenues 936.8 1,091.8 (14.2%) finance sector and the general business sector. In Proprietary software and services 872.5 941.3 (7.3%) spite of the drop in the sales revenues, the public Gross profit/(loss) on sales 314.6 293.8 7.1% administration sector accounted for 45% of the

Selling costs (44.2) (49.0) (9.8%) Company’s sales revenues. A significant drop of sales General and administrative – to 1% in 2016 – was recorded in the category of (81.0) (74.8) 8.3% expenses other operating activities. Other operating activities 1.6 7.2 (77.8%) In whole 2016, the sales revenues of Asseco Poland 191.0 177.2 7.8% Operating profit dropped by 14.2% on annual basis to PLN 936.8 EBITDA 243.4 230.1 5.8% million. Net profit 353.4 254.4 38.90%

EBITDA = EBIT + depreciation and amortization

20

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Public Administration Banking and Finance segment increased in 2016 by 3.8% to PLN 316.7 million. Asseco Poland is the most experienced Polish provider of IT solutions and services for the central In 2016, we continued our long-lasting cooperation administration. with PKO BP, which is the largest bank in the region. In addition, Asseco managed to strengthen its leading The results in this segment in 2016 were mainly position as a provider of software for the cooperative affected by a delay in expected rebound in the banking sector. The def3000 core banking systems announcements of new tenders related to the have been implemented for cooperative banks in absorption of the EU funds. Aleksandrów and Krasnystaw. In the case of Asseco Poland, a drop in revenues Changing trends in the banking sector affect the IT generated by these tenders was offset by a significant needs of financial institutions, increasing their share of long-term contracts with existing clients in demand for omnichannel and mobile solutions. In the portfolio - both for the maintenance of 2016, Asseco Poland successfully implemented the information systems implemented in recent years and Asseco Customer Banking Platform system for the for development of key solutions. As a result, the individual clients of Raiffeisen Polbank and the segment's revenues decreased by 9.8% to PLN 426.1 customers of cooperative banks affiliated with million in 2016. Spółdzielcza Grupa Bankowa. The system corresponds In 2016, we continued to work for the Social to the latest trends in the retail banking sector. Insurance Institution (ZUS) in the scope of The company is also one of the major developers of maintenance and upgrading of their Comprehensive software for capital markets. In 2016, it worked on Information System (CIS). In September 2016, Asseco the implementation of PROMAK Powiernik and Portfel Poland and ZUS extended the contract for the systems in leading Polish brokerage houses. At the maintenance of the system by the end of June 2018. same time, it worked on extending the functionalities In addition, Asseco Poland signed several other of PROMAK software, which, among others, adapted contracts for the maintenance and upgrading the it to the regulatory requirements of MiFID II. The new systems for existing customers: the Agency for regulation will apply to all capital market participants Restructuring and Modernization of Agriculture from 2018. (ARiMR) and the Agricultural Social Insurance Fund (KRUS). In the healthcare segment, where the slowdown in General Business the announcements of new tenders was particularly After a period of implementation and consolidation of significant, the Company focused on providing the billing systems in two energy companies - Enea services to existing customers, as well as adding new and Tauron - Asseco's specialists continued the functionalities and developing AMMS software. cooperation with the clients and worked on the While preparing for the challenges associated with development of the AUMS system. Also, the system the modernization and computerization of the Polish was being implemented in the Network Information Army, Asseco Poland continued to expand its Security Agency (INSA) in Ethiopia. The smaller scope competences in the security sector. The company of implementation works affected the revenues in the signed a contract with the European Space Agency to segment, which dropped by 14.9% to PLN 184 million develop new tools supporting the functioning of the in the entire year. European satellite system, developed a strategy for In the area of telecommunication and media, the the transfer of IT systems for one of the NATO's process of the centralization of the systems of mobile agencies and began cooperating with the Naval operator Polkomtel and Cyfrowy Polsat began. The Academy. project is being implemented in the cooperation with the Chinese company Huawei. In 2016, works were completed regarding the transfer of 3 million Banking and Finance customers of Orange Polska to a new billing system. Asseco Poland is the national leader in the Also, other projects were continued for that operator. development of software for financial institutions. In addition, the Company continued works for T- More than half of Polish banks use IT solutions Mobile operator which had begun earlier. produced by Asseco. The Company is furthermore one of the leading providers of IT systems for the capital market.The revenues generated by our

21

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

▪ Profitability significantly lower than the amounts of one-offs which affected the operating results in 2015. Presented below are the key profitability results for The net profit and margin of Asseco Poland are largely the year ended December 31, 2016 as well as for the dependent on the level of dividends received from the comparable period of the previous year: subsidiaries. These dividends are financial revenue of

Dec. 31, 2016 Dec. 31, 2015 the Company. In 2016, the revenues from dividends Change (audited) (audited) reached PLN 209.3 million and were significantly higher

Gross profit margin 33.6% 26.9% 6.7 pp than similar revenues in 2015. These factors resulted in a dynamic improvement in net profit to PLN 353.4 EBITDA margin 26.1% 21.2% 4.9 pp million and a significant improvement in net profit Operating profit margin 20.4% 16.2% 4.2 pp margin to 37.6%. Net profit margin 37.6% 23.5% 14.1 pp In 2016, all of our key profitability ratios improved in Quarterly financial results comparison with 2015. In spite of lower revenues, The tables below present our financial results for the gross profit increased by 7.1% toPLN 314.6 million in individual quarters of 2016 as well as for the that period. comparable periods of 2015: Profitability improved thanks to the change of the sales’ structure after the reorganization of Asseco mPLN Q1'16 Q2'16 Q3'16 Q4'16 Group in Poland and separation and transfer of the Revenues 213.0 239.5 233.0 251.3 infrastructure and general business division from of which proprietary 198.6 221.7 232.8 219.4 Asseco Poland to Asseco Data Systems software and services and DahliaMatic.As a result, the share of Asseco Margin IV 42.8 46.9 50.3 49.3 Poland’s proprietary software and services’ sales EBIT 43.6 47.1 50.7 49.6

increased – it is characterized by higher profitability Net profit 183.1 74.0 45.2 49.8 than the sales of third-party software and hardware. Depreciation and (13.6) (13.2) (13.3) (12.3) That translated into higher gross profit margin, which amortization increased by 6.7 percentage point to 33.6%. CFO 19.3 (13.0) 73.3 69.6 The improvement in gross profit also translated into CAPEX (incl. R&D) (5.2) (4.8) (7.0) (7.3) higher EBITDA, which increased by 5.5% toPLN 244.2 Margin IV = net profit on sales CFO = net cash provided by (used in) operating activities million in the reported period. Higher profit with lower CAPEX = expenditures for purchases of property, plant and equipment and intangible assets + revenues resulted in an increase in margin. In addition, expenditures for R&D projects due to delays in the announcements of new tenders in the public administration segment, higher share of revenues was generated by long-term maintenance contracts, characterized by higher profitability than mPLN Q1'15 Q2'15 Q3'15 Q4'15 implementation contracts.As a result, EBITDA margin Revenues 235.9 264.9 246.5 344.5 of which proprietary for that segment improved. In turn, total EBITDA 220.7 238.9 263.7 218.0 software and services margin increased by 4.9 percentage point to 26.1% in Margin IV 51.6 50.0 63.4 10.2 2016. With stable amortization level in the Company, the EBIT 51.9 56.6 60.3 8.4 improvement in EBITDA was the main factor behind Net profit 124.8 80.9 48.1 3.3 Depreciation and higher EBIT, which increased in 2016 by 7.8% to PLN (13.4) (13.6) (13.5) (12.4) amortization 191 million versus 2015. CFO 51.9 24.8 72.9 127.1 The operating result in 2016 was negatively affected by a write-down in the amount of PLN 6.5 million for the CAPEX (incl. R&D) (9.1) (11.3) (13.1) (6.6) Margin IV = net profit on sales impairment of trade receivables from KT Corporation, CFO = net cash provided by (used in) operating activities which constitutes half of the disputed amount. CAPEX = expenditures for purchases of property, plant and equipment and intangible assets + expenditures for R&D projects However, the amount of the write-down was

22

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Cash flow In 2016, cash flows from operating activities (CFO) transaction, the stake of Asseco Poland in the were lower than in 2015 due to delays in payments share capital of ACE increased to 99.32%. from Asseco Poland's business partners. ▪ In June 2016, as a result of exercising a put Lower cash flows from operating activities were option, Asseco Poland purchased 30% of shares partially offset by positive cash flows from investing in R-Style Softlab for the total amount of PLN 46.1 (CFI), which, in turn, were boosted by higher dividend million. As a result of the transaction, Asseco revenues, lower expenditure on the purchase of Poland's stake in R-Style has increased to 100%. shares in other companies and Asseco Western ▪ In addition, in 2016, Asseco Poland increased its Europe's share buyback from Asseco Poland, aimed at stake in Exictos (by 8%), UAB Asseco Lietuva (by share cancellation, conducted in May 2016. 15.6%) and UAB Sintagma (by 15.6%).

In 2016, a dividend for 2015 was paid in the amount The following table presents major lines of the of PLN 249.8 million. It was slightly higher than PLN separate statement of cash flows for the years 2016 240.7 million paid in 2015. and 2015. The lower level of the cash conversion rate (i.e.

Dec. 31, 2016 Dec. 31, 2015 FCF/adjusted EBIT) in 2016 was a result of lower operating cash flows related to a delay in the CFO 149.2 276.7 payment for supplies and services by KT Corporation CFI 113.6 (39.2) and higher level of operating profit. As a result, the

CAPEX (24.3) (40.1) rate dropped to 61.9% at the end of 2016 from 119.5% in the corresponding period in the previous M&A expenditures (124.0) (143.3) year. 124.9 236.6 Free cash flow Dividend income 193.3 130.1

CFF (286.2) (280.9)

Dividend payment (249.8) (240.7) Net change in cash and cash (23.4) (43.4) equivalents Cash conversion rate 61.86% 119.49% (FCF/EBIT Non-IFRS) CFO = net cash provided by (used in) operating activities Free cash flow - CFO-CAPEX CFI = net cash provided by (used in) investing activities CAPEX = expenditures for purchases of property, plant and equipment and intangible assets + expenditures for R&D projects M&A expenditures = expenditures for company acquisitions CFF = net cash provided by (used in) financing activities

In 2016, the Company’s cash flows were also influenced by merger and acquisition (M&A) transactions, which mainly involved purchases of shares in Asseco Poland's subsidiaries: ▪ In December 2016, Asseco Poland bought from the European Bank for Reconstruction and Development (EBRD) 2,221,356 shares of Asseco South Eastern Europe for the total amount of PLN 21.09 million (Regulatory Filling No. 27/2016). As a result of the transaction, Asseco Poland holds 55.34% of the shares and votes at the general meeting of ASEE. ▪ Also in December 2016, as a result of a tender offer for shares of Asseco Central Europe, Asseco Poland purchased 1,242,480 shares of the company for the total amount of PLN 29.2 million (Regulatory Filling No. 25/2016). As a result of the

23

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Balance sheet working capital was positively affected by a reduction in current liabilities to the level of PLN 250.1 million at In 2016, the total value of Asseco Poland’s assets the end of the financial year, mainly resulting from slightly dropped to PLN 5.6 billion from PLN 5.63 lower trade payables. billion in the previous year. The Company's assets In spite of lower level of working capital at the end of consist primarily of non-current assets worth PLN 5.13 2016, the liquidity ratios improved thanks to a drop in billion. current liabilities by PLN 116.4 million. The current Among fixed assets, the most important items are: liability ratio increased to 1.9 and the quick liability goodwill from business combinations, amounting to ratio went up to 1.8. PLN 2.01 billion as at December 31, 2016 and As in the previous reporting periods, both ratios in investments in subsidiaries and associates, which 2016 are close to each other, which is a result of low increased to PLN 2.4 billion at the end of the year. level of inventories held by the Company (PLN 6.5 million at the end of 2016) and prepayments (PLN 8.8 The investments in subsidiaries and associates largely million at the end of 2016). involve securities of public companies listed in Poland

or abroad. It is worth noting that in the case of the The table below presents the closing balances of securities of Israeli holding company Formula working capital as at December 31, 2016 and at the Systems, consisting of Israeli companies of Asseco end of the previous comparable period. Group (Matrix IT, Magic Software and Sapiens International), the market valuation is significantly Dec. 31, 2016 Dec. 31, 2015 higher than the book value. A similar situation can be observed in the case of Asseco Business Solutions, Working capital (in millions of PLN) 216.2 290.4 which is controlled by Asseco Poland indirectly Current liquidity ratio 1.9 1.8

through Asseco Enterprise Solutions. Quick liquidity ratio 1.8 1.7

Absolute liquidity ratio 0.1 0.1 The table below presents the market and book value Working capital = current assets - current liabilities of the publicly-listed investment assets of Asseco Current liquidity ratio = current assets / current liabilities Poland. Quick liquidity ratio = (current assets - inventories – prepayments) / current liabilities Absolute liquidity ratio = (cash + short-term bank deposits) / current liabilities Market and book value of investment assets (in millions of PLN)

1200 1 130 In spite of a drop in current liabilities, the absolute liquidity ratio did not improve due to a lower level of 1000 cash and deposits at the end of 2016 versus 800 December 31, 2015.

600 507 507 427 359 400 292 266 ▪ Debt 200 69 As at December 31, 2016, the total value of Asseco 0 Poland S.A.’s assets did not significantly change versus Asseco CE Asseco SEE Formula Asseco BS* Systems the end of the previous year and reached PLN 5.6 Book value Market value billion. Therefore, lower level of both non-current and current liabilities translated into a drop in debt ratios *Indirectly through Asseco Enterprise Solutions and a debt/equity ratio. ▪ Liquidity The below table presents debt ratios as at December 31, 2016 and at the previous reporting date. In the analysis of liquidity, Asseco Poland S.A. uses the

ratio of working capital, defined as the difference December 31, 2016 December 31, 2015 between current assets and current liabilities. It represents the amount of capital which is used to Total debt ratio 8.7% 11.3% finance current assets. Debt/equity ratio 3.4% 3.9%

A drop in that ratio is a result of lower level of current Short-term debt ratio 4.5% 6.5% assets as at December 31, 2016, which was mainly Long-term debt ratio 4.3% 4.8% caused by a drop in trade receivablesat the end of the Total debt ratio = (non-current liabilities + current liabilities) / assets period to PLN 366 millionfrom PLN 508.3 million at Debt/equity ratio = (interest-bearing bank loans + debt securities + finance lease liabilities) / equity the end of 2015, and lower level of cash. In turn, Short-term debt ratio = (current liabilities / assets) Long-term debt ratio = (non-current liabilities / assets)

24

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

described in explanatory note V.10 under the The total debt ratio dropped to 8.7% thanks to lower supplementary information to the financial level of liabilities which decreased by PLN 145.8 statements of Asseco Poland for the period million in 2016. Non-current liabilities slightly of 12 months ended 31 December, 2016. dropped thanks to regular repayment of the non- ▪ Asseco Western Europe S.A.'s buy-back on current loans and finance lease liabilities. A reduction May 25, 2016. Asseco Western Europe S.A. in these liabilities translated into a drop in non- purchased from Asseco Poland S.A. current liabilities by PLN 29.4 million and the 15,744,681 of its own shares for cancellation. improvement in the long-term debt ratio, which The value of the transaction reached PLN reached 4.3% at the end of December 2016 versus 59.2 million. 4.8% in the same period in the previous year. ▪ Acquisition of 30% of the shares of R-Style Thanks to a significant reduction in the current Softlab JSC (Regulatory Filling No. 21/2016) liabilities, to the value close to the level of non- for the total value of USD 12.09 million. As a current liabilities, the short-term debt ratio result of the transaction, Asseco Poland's significantly improved. In 2016, above all, a reduction stake in the company increased to 100%. was recorded in the trade payables, liabilities to the state and local budgets and other liabilities. As a ▪ Acquisition of the shares of Asseco Central result, the short-term debt ratio reached 4.5% at the Europe on December 22, 2016 (Regulatory end of 2016, two percentage points more than as at Filling No. 25/2016). As a result of a tender December 31, 2015. offer, Asseco Poland purchased 1,242,480 shares of the company, representing 5.82% in its share capital. As a result of the Non-recurring events with impact on our financial transaction, Asseco Poland's stake in the performance company increased to 99.32% from 93.51%. Non-recurring events with impact on the financial ▪ Acquisition of the shares of Asseco South performance, assets and cash flow of Asseco Poland Eastern Europe S.A. on December 22, 2016 in the year 2016 and in the comparable period were (Regulatory Filling No. 27/2016). Asseco as follows: Poland bought from the European Bank for Reconstruction and Development (EBRD) ▪ Sales of the organized parts of the Company: 2,221,356 shares of Asseco South Eastern "Pion SAP" (SAP Division - with a total value Europe, representing 4.28% in its share of PLN 13.8 million) and "Pion capital, for the total amount of PLN 21.1 Przedsiębiorstw" (General Business Division - million. As a result of the transaction, Asseco with a total value of PLN 28.2 million) to Poland's stake in the company increased to DahliaMatic Sp. z o.o. in exchange for 832 55.34% from 51.06%. new shares of DahliaMatic with a nominal value of PLN 500 each.The transactions have ▪ Write-down for the impairment of trade been described in explanatory note V.10 receivables from KT Corporation. As at under the supplementary information to the December 31, 2016, the Company held trade financial statements of Asseco Poland for the receivables from KT Corporation amounting period of 12 months ended 31 December, to PLN 88.9 million. The Company made a 2016. write-down amounting to PLN 6.5 million, which constitutes half of the disputed ▪ Sales of the organized part of the Company: amount. The amount of the write down for "Pion Infrastruktury" (Infrastructure Division this impairment was determined individually, - with a total value of PLN 188.1 million) to regardless of the rules resulting from the Asseco Data Systems S.A. in exchange for Company's accounting policy. 3,657,777 ordinary registered shares with a nominal value of PLN 10 each, which were ▪ Sale of a business venture of Asseco Poland issued by Asseco Data Systems S.A. as part of S.A. to its subsidiary Insseco Sp. z o.o., which the share capital increase. has been described in explanatory note V.9 under the supplementary information to the ▪ An increase of Asseco Poland’s engagement financial statements of Asseco Poland for the in Exictos, UAB Asseco Lietuva and UAB year 2015.This transaction concerned certain Sintagma through the purchase of their assets, including copyrights as well as the shares in 2016.The transactions have been rights and obligations arising from contracts

25

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

that have so far been executed by the 28/2015 as well as in explanatory note V.9 Company for some clients in the commercial under the supplementary information to the insurance industry. consolidated financial statements of Asseco Group for the period of 12 months ended ▪ Acquisition by Asseco Poland of a 61.38% December 31, 2015. stake in Portugal-based Exictos SGPS for EUR 21.48 million. This transaction has been Opinion on feasibility of investment plans described in detail in explanatory note V.9 Asseco Poland S.A. pays its trade payables, settles the under the supplementary information to the state obligatory charges, and fulfils its investment consolidated financial statements of Asseco Group for the period of 12 months ended obligations on a timely basis. We maintain loan facilities at various banks in order to diversify our December 31, 2015. sources of financing.The Company pays its liabilities ▪ Decision to create an allowance for our trade from current operating revenues which may be receivables from Mostostal Warszawa, in the supplemented with third party financing, in the form amount of PLN 7.7 million. of short-term bank overdraft facilities, bank term ▪ Acquisition of 100% of shares in Infovide- loans, borrowings, or capital contributions. Matrix S.A., a Polish IT company listed on the Warsaw Stock Exchange. This transaction has been described in our Regulatory Filling No.

Asseco Poland S.A. on the capital market

70 Asseco Poland shares in 2016 2100 65

2000 WIG20 Index (Points) Index WIG20 60 1900

55 1800

50 1700

45 1600 Price of Asseco Asseco of sharesPrice (PLN) Poland

40 1500 sty 16 mar 16 maj 16 lip 16 wrz 16 lis 16

Asseco Poland WIG20

2016-01-04 2016-03-31 2016-06-30 2016-09-30 2016-12-31 Δ 12M

Asseco Poland S.A. (PLN) 55.50 60.59 52.51 55.71 53.96 -2.77%

WIG20 (points) 1,804.42 1,997.69 1,750.69 1,709.51 1,947.92 7.95%

WIG (points) 45,356.65 49,017.35 44,748.53 47,084.949 51,754.03 14.10%

WIG-Info (points) 1,586.45 1,772.31 1,714.45 2,032.44 2,155.40 35.86%

26

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Company’s stock information changes to economic policy affected the share prices Total number of shares 83,000,303 of the largest companies, especially in the banking ISIN PLSOFTB00016 and energy sector. GPW ACP Globally, investors focused on the referendum on the Reuters ACPP.WA exit of the Great Britain from the European Union - Bloomberg ACP PW the decision of the country to leave the EU affected the emerging markets, including Poland. In the second half of the year, investors shifted their focus to the US In 2016, the share price of Asseco Poland followed the presidential election. The nomination of Republican WIG20 index for most of the year and only in the last candidate Donald Trump has been positively received quarter it did not benefit from improving sentiment by investors and, together with rising prices of oil and on the capital market. As a result, the share price of commodities, has led to an increase in risk appetite. Asseco dropped by 2.8% during the year while the That has also positively affected the stock exchange in WIG20 index rose by 7.95% and the WIG index Warsaw. increased by 14.1%. The sector index WIG- Informatyka, in which Asseco Poland has a significant The factor which had a stabilizing effect on the share share, grew by 35.9%. price of Asseco Poland was the payment of a dividend in the amount of PLN 3.01 per share. For most of the previous year, the Polish capital market was influenced mainly by political factors in the country and abroad. In Poland, the proposals for

Shareholder structure

Aviva Pension Fund holds 9,384,498 shares representing 11.31% of voting rights Adam Góral holds 8,083,000 shares representing 9.74% of voting rights PZU Pension Fund holds 4,281,040 shares Other shareholders hold representing 5.16% of 57,080,644 shares voting rights representing 68.77% of Nationale-Nederlanden voting rights Pension Fund holds 4,171,121 shares representing 5.02% of voting rights

Major Shareholders as at December 31, 2016 As at the date of publication of this report, i.e. on

March 16, 2017, the Shareholders who, either directly or through their subsidiaries, hold at least 5.0% of As at December 31, 2016, the Shareholders who, total voting rights are as follows: either directly or through their subsidiaries, held at

Shareholders Percentage of total voting least 5.0% of total voting rights were as follows: Number of shares held as at March 16, 2017 rights Shareholders Percentage of total 2) Number of shares held Aviva Open Pension Fund 9,384,498 11.31% as at December 31, 2016 voting rights Adam Góral, President 2) 8,083,000 9.74% Aviva Open Pension Fund 9,384,498 11.31% of the Management Board3) Adam Góral, President 1) 8,083,000 9.74% PZU Open Pension Fund 4,281,040 5.16% of the Management Board3) NN Open Pension Fund4) 4,171,121 5.02% PZU Open Pension Fund1) 4,281,040 5.16% Other shareholders 57,080,644 68.77% NN Open Pension Fund4) 4,171,121 5.02% 83,000,303 100% Other shareholders 57,080,644 68.77% 1) In accordance with the regulatory filling no. 38/2010 of June 2, 2010 83,000,303 100% 2) In accordance with the regulatory filling no. 02/2012 of January 5, 2012 3) In accordance with the regulatory filling no. 51/2012 of December 15, 2012 1) In accordance with the regulatory filling no. 38/2010 of June 2, 2010 4) In accordance with the regulatory filling no. 21/2015 of October 19, 2015 2) In accordance with the regulatory filling no. 02/2012 of January 5, 2012 3) In accordance with the regulatory filling no. 51/2012 of December 15, 2012

27

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

4) In accordance with the regulatory filling no. 21/2015 of October 19, 2015 The rules included in this policy are applied to all of the Company’s employees. As at the publication date of the prior report, i.e. on General rules for remuneration practices: November 17, 2016, the Shareholders who, either ▪ the remuneration system should be adjusted directly or through their subsidiaries, held at least 5.0% to match the Company’s business strategy, of total voting rights were as follows: objectives and long-term interests; Shareholders Percentage of total voting Number of shares held as at November 17, 2016 rights ▪ an incentive system should be used in order Aviva Open Pension Fund2) 9,384,498 11.31% to ensure adequate human resources; Adam Góral, President 8,083,000 9.74% of the Management Board3) ▪ the amount of remuneration should depend PZU Open Pension Fund1) 4,281,040 5.16% on the type of work performed and NN Open Pension Fund4) 4,171,121 5.02% qualifications required for the job, taking into Other shareholders 57,080,644 68.77% account the quality of work performed; 83,000,303 100% ▪ the remuneration system is based on the 1) In accordance with the regulatory filling no. 38/2010 of June 2, 2010 2) In accordance with the regulatory filling no. 02/2012 of January 5, 2012 Company’s competence scheme which 3) In accordance with the regulatory filling no. 51/2012 of December 15, 2012 4) In accordance with the regulatory filling no. 21/2015 of October 19, 2015 organizes the tasks and roles of employees, and also promotes the development of organizational culture oriented towards Shares held by the management and supervisory customers, quality, achievement of results, personnel collaboration, and professional development; The numbers of Asseco Poland shares held by its ▪ the remuneration system should be management and supervisory staff are presented in designed, implemented and supervised in the table below: compliance with the principles of effective finance and risk management of the March 16, 2017 Dec. 31, 2016 Company. Jacek Duch – Chairman of 31,458 31,458 31,458 The policy of remuneration payable to the members the Supervisory Board of the Company’s management body is based on the Adam Góral – President of below listed principles; however, the amount of 8,083,000 8,083,000 8,083,000 the Management variable remuneration shall be subject to an upper Board Tadeusz Dyrga – Vice limit: President of 3,710 3,710 3,710 the Management ▪ each of the Management Board Members is Board be paid a fixed remuneration in the gross Robert Smułkowski – Vice President of the 2,212 2,212 2,212 amount of PLN 30,000 per month; Management Board ▪ variable remuneration of a Member of The remaining members of the Supervisory Board and the Management Board depends on: Management Board did not hold any shares in Asseco • Poland S.A. in any of the above-mentioned periods. the amount of margin IV achieved by the business units supervised Remuneration policy report directly by a particular Member of the Management Board; The objective of the Company’s remuneration policy is to support the strategy of achieving the target • the amount of net profit earned by business results, while meeting the needs of the Company’s capital group. employees within the Company’s financial

capabilities. The table below presents the gross amounts of total The human resources policy is implemented in and variable remuneration payable to the Members of accordance with the provisions of law as well as the Management Board for performing their internal procedures and standards adopted by the managerial duties at Asseco Poland S.A. during the Company. year 2016: The policy guidelines take into account the processes of recruitment, retaining and development of employees.

28

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

objectives and development strategy, particularly in Gross amount of remuneration Variable Total remuneration for the period (in millions of terms of long-term shareholder value growth and the remuneration PLN) stability of its operations.Over the last year, the

1.52 1.88 Company did not introduce any significant changes to Adam Góral its remuneration policy. Przemysław Borzestowski 0.75 1.11 These remunerations were paid generally on a monthly Andrzej Dopierała 0.03 0.20 basis, whereas in the case of Formula Systems Ltd. – on 1.43 1.79 Tadeusz Dyrga a quarterly basis. Krzysztof Groyecki 0.26 0.47 The table below presents the gross amounts of fixed Rafał Kozłowski 0.59 0.95 and variable remuneration payable for performing 0.86 1.21 Marek Panek managerial duties at the Group’s subsidiary 1.34 1.70 Paweł Piwowar companies: Zbigniew Pomianek 1.77 2.13

Włodzimierz Serwiński 0.12 0.21 mPLN Asseco Western Europe S.A.

Przemysław Sęczkowski 0.74 1.10 fixed variable

Robert Smułkowski 0.78 1.14 Rafał Kozłowski 0.17 0

Total 10.19 13.89 Przemysław Sęczkowski 0.17 0.45

The total amount of remuneration payable to the Total: 0.34 0.45 Management Board Members is largely dependent on The policy of remuneration payable to the members of the Company’s financial performance. The management bodies at the Group’s subsidiary remuneration model adopted by the Company is companies is similar that applicable in the Parent aimed to award the Management Board Members and Company: other managerial staff depending on the actually achieved financial results, as well as to constantly ▪ fixed remunerations are paid on a monthly motivate them to accomplish the business targets set basis; for a given period. ▪ variable remunerations depend on:

• the amount of margin IV achieved The table below presents the gross amounts of by the business units of Asseco Data remuneration payable to the Management Board Systems Group; Members for performing supervisory duties on the • the amount of net profit earned by Supervisory Boards of Asseco Group companies: Asseco Western Europe Group. Formula ZUI Systems Grupa SKG mPLN ABS S.A. ADS S.A. Novum The Management Board Members are not entitled to (1985) ACE S.A. Sp. z o.o. Ltd. any other packages of additional benefits, also in terms Adam Góral 0.06 - - 0.05 - 0.05 of severance payments upon their dismissal. Przemysław - - - - 0.02 - Borzestowski Information on the full amount or remunerations paid Rafał - - - - - 0.13 Kozłowski to the Members of the Management Board and Marek Panek - - 0.13 0.04 - - Supervisory Board of Asseco Poland S.A. is provided in Zbigniew - - - - 0.04 0.04 Pomianek explanatory note 35 to the financial statements of Przemysław - - - - - 0.04 Sęczkowski Asseco Group for the year ended December 31, 2016. Total: 0.1 0.82 0.26 0.13 0.02 0.09

As regards the package of additional employee benefits, Members of the Management Board and key managers, just like other employees, are subject to the labour law regulations.Moreover, the Company provides specialized medical care and subsidies to the employees’ participation in sports activities. The Company believes that the applied remuneration policy supports the implementation of the Company’s

29

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Discussion of significant risk factors and threats Asseco Poland S.A. constantly monitors major factors to become less attractive, and eventually not as posing risk to its operations in order to identify, profitable as expected. Additionally, it cannot be prevent and mitigate their possible effects. For this taken for granted that the new solutions which are, or purpose, the Company has introduced a number of will be, created or developed by Asseco will satisfy management systems as well as control procedures the technological requirements, and whether they will and internal audit. In particular, Asseco uses the be accepted positively by their potential users.Such following systems: circumstances might have a significant adverse impact on the operations, financial position, financial results ▪ quality management system; and prospective development of Asseco. ▪ risk management system; Risk related to market saturation ▪ business continuity management system; Technological saturation that begins to emerge in the ▪ information security management system; Polish banks and private enterprises may prompt them to focus their strategies on smaller or mid-size ▪ system monitoring the compliance with the IT projects that would address their current needs law and general standards, as well as the only.Such circumstances might have a significant market standards adopted by the Company; adverse impact on the operations, financial position, ▪ internal control system. financial results and prospective development of Asseco. The systems and smoothly functioning internal audit effectively reduce the negative impact of the Risk related to consolidation and structural changes following risk factors and threats to the Company's in the financial sector operations. The finance sector is the place of ongoing consolidation processes. There is a risk that consolidators of this sector will force the acquired Risk related to intensified competition financial institutions to use their global IT solutions, Business operations of Asseco Poland are under the which may slow down the process of gaining new pressure of intense competition both from local contracts or even result in termination of already players and international IT corporations. Competitors concluded contracts. In addition, in the finance sector, with global reach are getting continually stronger as there is a growing trend of establishing both IT and they have got faster access to innovative finance services companies (fintechs), whose technological solutions, but also to cheaper sources of solutions may be competitive for the products of the funds which makes it possible to finance large Company or may introduce alternative mechanisms of contracts more efficiently.It is not certain whether the the functioning of finance companies, which may increasing competition will have no significant affect acquiring new contracts. adverse impact on the Company’s operations, Such circumstances might have a significant adverse financial position, financial results and future impact on the operations, financial position, financial development outlook. results and prospective development of Asseco. Risk related to technological changes in the industry Risk related to carrying out of public tenders and development of new products Delays in finalization of the tendering procedures for The IT sector is characterized by rapid development of delivery of IT infrastructure for the public new solutions and technologies, which shorten the administration may result in unstable revenues from lifecycle of products.Therefore, the future success of this sector. If combined with unsatisfactory utilization Asseco Poland will largely depend upon our capability of the EU funds granted for improving innovation at to incorporate the latest technological solutions into public offices, this might substantially reduce the local our products and services.In order to maintain the demand for IT services and thereby exert a negative competitive advantage in this market, it is necessary impact on the operations, financial position, financial to conduct research work and to invest in new results and prospective development of Asseco. products.Asseco keeps on monitoring the present information technology trends and develops and Risk involved in gaining new contracts upgrades its business offer accordingly.However, It is characteristic of the IT business that most of there is still a risk that the market will receive new contracts of Asseco Poland are awarded under products, which will cause our products and services tendering procedures.Therefore, it is not certain that

30

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

the Company will be able to gain such new contracts regulatory risk occurring in the environment in which that would ensure sufficiently high and satisfactory Asseco Poland operates.The tax regulations and their revenues in the future.These factors might have a interpretations are more than others prone to significant adverse impact on the operations, financial numerous changes.Practices of the internal revenue position, financial results and prospective administration and the court judicature are not development of Asseco. uniform in this domain.In the event the taxation authorities take a position that is different from our Risk related to the macroeconomic situation of interpretation of tax regulations, the operations, Poland financial position and financial results of Asseco may Development of the IT services sector is closely be exposed to negative consequences thereof.Such correlated to the overall economic prosperity.The risk may be materializing especially due to potential main factors affecting the financial results of Asseco doubts expressed by the taxation authorities over the Poland include the pace of GDP growth, value of transactions the Company conducts with its related public orders for IT solutions, level of capital parties.This might have a significant adverse impact expenditures made by enterprises, inflation rate, and on the operations, financial position, financial results foreign currency exchange rates versus the Polish and prospective development of Asseco. zloty. Risk of losing the clients’ trust Risk of becoming dependent on the key customers Operations of Asseco Poland S.A. are to a large extent The implementation of contracts with key clients will based on the customers’ trust. Implementation of an heavily impact the level of sales revenues generated IT system, which has critical importance for by Asseco Poland in the coming years. It cannot be the customer’s business, usually results in signing a precluded that a potential loss of any major client, long-term agreement with the system user. The deterioration in the financial terms for provision of quality of solutions and services provided to such services, or potential compensatory claims would clients determines their confidence in the Asseco have a significant adverse impact on the operations, brand.In the event the quality of delivered products financial position, financial results and prospective and services was poor, our customers might lose their development of Asseco. trust in Asseco, which might hurt our reputation in the market and make it impossible to continue Risk of increasing cost of work successful business operations. Salaries account for over 70% of the project Risk of underestimation of the project cost implementation costs.Taking into account such high human resource requirements, an increase in salaries Most of Asseco’s profits are derived from the would squeeze the margins achieved on projects, and execution of complex information technology projects consequently have an unfavourable impact on the carried out under long-term agreements with a financial results of Asseco Poland S.A. predefined remuneration. Implementation of such projects requires very good planning both in terms of In order to manage the risk of higher cost of work, the the schedule of work and the resources needed to Company takes a number of measures which can help provide the promised scope of the contract.Here reduce potential negative effects of rising the Company follows complex procedures, which on salaries.Among other things, Asseco (i) employs one hand facilitate the process of preparation of people in many geographical regions aiming to reliable plans and on the other hand prevent the diversify that risk, (ii) continually monitors the level of incurrence of unexpected costs. salaries in the market not to be taken by surprise, and (iii) tries to maintain an appropriate structure of In order to manage the risk of the project cost employment within particular levels of competence. underestimation, Asseco Poland applies the methods (either based on the world recognized standards or Risk of changes in regulations and their proved by own experience) for estimation of the interpretation project costs, preparation of work schedules, and Frequent amendments, lack of cohesion and uniform identification of risks that may hinder timely, interpretations of the provisions of law, concerning in professional or financial performance under a particular the tax regulations, banking law, insurance contract. law (inclusive of social insurance), public procurement Risk of concluding a contract with a dishonest law, personal data protection law, regulations customer pertaining to trading in securities and public offering, and commercial companies law, give rise to the

31

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Asseco is exposed to the risk of defaulting In recent years, cyber security has become one of the contractors. This risk is connected firstly with major challenges which contemporary states and the financial credibility and good will of customers to economies have to face. The scale of cybercrime has whom the Company provides IT solutions, and been growing at an unprecedented pace so far. secondly with the financial credibility of contractors As a result of deliberate actions of third parties or with whom supply transactions are concluded. dishonest employees, as well as mistakes or Hence, the risk control measures usually consist of carelessness of our employees or contractors, monitoring the timely execution of bank transfers confidential data of the Company or of our clients and, if needed, sending a reminder of outstanding may be disclosed to unauthorized persons.Such payment. In addition, the Company uses processes for circumstances might have an adverse impact on the the initial and periodic verification of the operating perception of Asseco by our clients, and consequently process for external entities.In the case of smaller on the Group’s operations, financial position, financial clients, it is quite helpful to monitor their industry results and prospective development. press as well as to analyze previous experience Risk of property damage gathered by ourselves and by our competitors, etc. As a result of abuse or errors committed by Risk of inability to effectively integrate the taken- employees of Asseco, the Company may suffer over companies or to achieve the intended rates of damage to its property.Such circumstances might return on acquisitions or investments have an adverse impact on the Group’s financial Asseco Poland implements the strategy of condition and business continuity, and consequently development, among others, through acquisitions of on the Company’s operations, financial position, or capital investments in IT companies.Valuation of financial results and prospective development. the future acquisitions or investments will depend on the market conditions as well as on other factors beyond the Asseco’s control.It cannot be entirely precluded that the investor company may be unable to accurately estimate the values of undertaken acquisitions or investments.There is also a risk that earnings generated by the acquired or investee companies fall short of the initial estimates which might prevent us from achieving the rates of return that were originally expected from such transactions. Risk related to losing the key personnel The Company’s operations and development outlook depend to a large extent on the knowledge, experience and professional qualifications of its employees, who implement the IT projects.A substantial demand for IT specialists and the competitors’ activities may induce the key personnel to leave our organization, and also make it quite difficult to recruit new employees with suitable knowledge, experience and professional qualifications.Still there is a risk that resignation by the key personnel would have a negative impact on the execution of IT contracts conducted by the Company, as well as on ensuring the required quality and range of services provided. This in turn might have a significant adverse impact on the operations, financial position, financial results and prospective development of Asseco Poland S.A. Risk associated with cyber-security, including the issue of data leakage

32

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

OTHER INFORMATION contest called Asseco Programming Marathon24. In addition, Asseco Poland’s specialists give lectures in Explanation of differences between the financial graduate and postgraduate programs at the Warsaw results disclosed in the annual report and University of Life Sciences as well as at the University previous financial forecasts for the year. of Information Technology and Management in Rzeszów. Moreover, Asseco Poland has for years Asseco Poland S.A. did not publish any financial provided regular financial and material support to forecasts for the year 2016. the following foundations: Cooperative Banking Opinion on feasibility of the ManagementBoard Development Foundation, Foundation “A kogo?” financial forecasts for 2016 (Who cares?), Foundation “Mimo wszystko” (Despite everything), and TVN’s Foundation “Nie jesteś sam” The Management Board of Asseco Poland S.A. did not (You are not alone). publish any financial forecasts for the year 2016 or for subsequent financial periods. Agreements concluded by Asseco Poland S.A. with its management personnel providing for Changes in the Company management policies payment of compensations if such persons resign During the year 2016, the Company’s management or are dismissed from their positions practices remained unchanged. Asseco Poland S.A. did not conclude any agreements Remuneration of the management and with their management officers that would provide supervisory personnel for payment of compensations in the event such persons resign or are dismissed from their positions The amounts of remuneration due to our without substantial reason, or when they are management and supervisory staff have been dismissed as a result of a company merger by disclosed in explanatory note 34 to the separate acquisition. financial statements of Asseco Poland S.A. for the year ended December 31, 2016. Information on the agreements known to the Issuer which may result in future changes Description of the Company’s sponsoring and of the equity interests held by the existing charity policy shareholders and bondholders Since 2006, Asseco Poland has been a major sponsor There are no agreements which may result in future of the leading volleyball team Asseco Resovia changes of the equity interests held by the existing Rzeszów. The Company also supports one of the best shareholders and bondholders. teams in the Polish basketball league, namely Asseco Gdynia. The Management of Asseco Poland is an Organizational and equity relationships active supporter, not only in financial terms, but also Asseco Poland S.A. is the parent company of Asseco by devoting their time and expertise to assist the Poland Group, and its equity relationships have been players and help the teams in building their strategies presented in explanatory note 10 to the annual for development. financial statements of Asseco Poland S.A. for the For the last two years, on the occasion of Christmas, year ended December 31, 2016. Asseco Poland has provided one-time financial donations to institutions and foundations that had Related party transactions been selected by the company’s employees.These Related party transactions have been presented in organizations operate in the regions where the explanatory note 26 to the annual financial divisions of Asseco Poland are based. The charity statements of Asseco Poland S.A. for the year ended campaign “We Help” has been created on the December 31, 2016. These transactions were carried initiative of the Management Board of Asseco Poland out on an arm’s length basis. that decided to resign from buying any Christmas presents for the company’s clients.This way the Bank loans, borrowings, sureties and guarantees company saved PLN 200,000 and allocated this money Bank loans drawn, loans granted, as well as sureties to a campaign, where our employees take part in an and guarantees granted have been described in internal competition to come up with the best project explanatory notes 21 and 28 to the annual financial of aid for various social institutions. statements of Asseco Poland S.A. for the year ended The company co-finances the organization of the December 31, 2016. Olympiad in Informatics as well as the international

33

Report on Operations of Asseco Poland S.A. for the year ended December 31, 2016

Loans granted during the financial year Information on adhering to the corporate Information on loans granted by Asseco Poland S.A. governance standards has been presented in explanatory note 12 to the Information on adhering to the corporate governance annual financial statements of Asseco Poland S.A. for standards has been contained in the separate Report the year ended December 31, 2016. on compliance of Asseco Poland S.A. with the Off-balance-sheet items corporate governance standards in the year 2016. The nature, purpose and value of significant off- Agreement with the entity authorized to audit balance-sheet items have been presented in financial statements explanatory notes 28 and 29 to the annual financial The agreement with the entity authorized to audit statements of Asseco Poland S.A. for the year ended financial statements, namely Ernst & Young Audyt December 31, 2016. Polska Sp. z o.o. sp. k., to carry out audits of the Utilization of proceeds from issuance of shares separate and consolidated financial statements of Asseco Poland S.A. drawn up for the year ended In the period of 12 months ended December 31, 2016, December 31, 2016 was signed on July 30, 2016. Asseco Poland S.A. did not issue any new shares. Remuneration of the entity authorized to audit Monitoring of employee stock option plans financial statements As at the date of preparation of this report, Information on remuneration due to the entity the Company did not run any share-based employee authorized to audit financial statements has been incentive scheme. provided in explanatory note 33 to the annual Significant agreements concluded by the financial statements of Asseco Poland S.A. for the Company year ended December 31, 2016. This Management Report on Operations has been As the Company informed in the Regulatory Filling no. approved for publication by the Management Board 24/2016, on October 10, 2016 it received a decision of of Asseco Poland S.A. on March 16, 2017. the Management Board of the Social Insurance Institution (ZUS) about concluding an Annex to the Agreement for the provision of operational support and maintenance services for the Comprehensive Information System at ZUS. The company informed about the conclusion of the agreement in the Regulatory Filling no. 19/2013, on October 10, 2013. The Annex has been concluded under a supplementary order within the meaning of art. 19 sect. 3 item 2 letter b of the Act of June 22, 2016 on amending the Public Procurement Law and certain other acts. The Annex value shall not exceed PLN 73 million net. The signed Annex shall extend the effective period of the Agreement till June 30, 2018 or till the time when funds appropriated for the execution of work covered by the Annex are fully used. Information on judicial proceedings where the value in dispute exceeds 10% of the amount of equity At the publication date of this report, the Company was not a party to any proceedings pending before any court, arbitration authority or public administration authority, under which the value in dispute would exceed 10% of the Company’s equity.

34

Statements by

the Management of

Asseco Poland S.A. to the Annual Report

Statements made by the Management Board of Asseco Poland S.A. to the Annual Report for the year ended December 31, 2016

Statement made by the Management Board of Asseco Poland S.A. on the reliability of preparation of the annual financial statements of Asseco Poland S.A. for the year ended December 31, 2016 The Management Board of Asseco Poland S.A. hereby declares that, to the best of its knowledge, the annual financial statements of Asseco Poland S.A. for the year ended December 31, 2016 and comparable data contained therein have been prepared in compliance with the applicable accounting standards, namely the International Financial Reporting Standards as endorsed by the European Union. Furthermore, the Management Board declares that the presented data give a true, reliable and fair view of the Company’s assets, financial position and financial performance.The report on operations of Asseco Poland S.A. provides a fair description of the development, achievements and economic position of the Company, inclusive of major risks and threats to its operations.

President of the Management

Adam Góral Board

Vice President of the

Przemysław Borzestowski Management Board

Vice President of the

Tadeusz Dyrga Management Board

Vice President of the

Krzysztof Groyecki Management Board

Vice President of the

Rafał Kozłowski Management Board

Vice President of the

Marek Panek Management Board

Vice President of the

Paweł Piwowar Management Board

Vice President of the

Zbigniew Pomianek Management Board

Vice President of the

Przemysław Sęczkowski Management Board

Vice President of the

Robert Smułkowski Management Board

Statement made by the Management Board of Asseco Poland S.A. on the entity authorized to audit the annual financial statements of Asseco Poland S.A. for the year ended December 31, 2016 The Management Board of Asseco Poland S.A. hereby declares that the entity authorized to audit the annual financial statements of Asseco Poland S.A. for the year ended December 31, 2016, namely Ernst & Young Audyt Polska Sp. z o.o. Sp.k., seated in Warsaw, has been chosen in accordance with the provisions of the law in force.This entity as well as certified auditors, who audited these financial statements, satisfied the conditions for expressing an impartial and independent opinion on the audited annual financial statements, in line with the applicable regulations and professional standards.

President of the Management

Adam Góral Board

Vice President of the

Przemysław Borzestowski Management Board

Vice President of the

Tadeusz Dyrga Management Board

Vice President of the

Krzysztof Groyecki Management Board

Vice President of the

Rafał Kozłowski Management Board

Vice President of the

Marek Panek Management Board

Vice President of the

Paweł Piwowar Management Board

Vice President of the

Zbigniew Pomianek Management Board

Vice President of the

Przemysław Sęczkowski Management Board

Vice President of the

Robert Smułkowski Management Board

Asseco Poland S.A. 14 Olchowa St.

35-322 Rzeszów, Poland

phone: +48 17 888 55 55 fax: +48 17 888 55 50 e-mail: [email protected] inwestor.asseco.pl