In connection with the preparation of the financial reports, the Board of Directors and management of Azelio must make assessments and assumptions that affect the balance sheet and income statement items and related information. The items below are considered to be the most important items for understanding the financial reports based on the significance of the assessments and uncertainty. The conditions for Azelio are changed on an ongoing basis, which means that these assessments may change.
The current valuation of the company's assets in the form of capitalized development costs, inventories and shares in subsidiaries presupposes that the business plan that exists will be realized. The expected future sales volumes are so extensive that the discounted cash flows from these can justify the current valuations with a good margin. The company believes that the probability is good to implement the business plan and that capitalized development costs will probably lead to future economic benefits. Based on this assessment, there is therefore no need for write-downs according to the impairment tests carried out by the company's capitalized development costs of its inventories or the value of shares in subsidiaries.
The company's capitalized development costs have been made in various technologies. However, all are connected to the Stirling engine and the thermal storage, which are the primary technologies that the company builds on its business. The development of the technology in the gas engine has, according to the Board, been a prerequisite for the current solar engine, as a result of technical synergies. As a result of the close connection between the technical solutions, the machines are not delimited as separate cash-generating units. The new solar engine is a further development of previous technology and thus no write-downs have been made regarding development costs for previous versions. However, scraps in stock have been made for the parts that have been unique to previous versions of the products.
As of the closing date, Azelio had tax loss carryforwards of business activities amounting to SEK 730,968,000. These loss carryforwards have not been assigned any value in the balance sheet since the company has previously not reported any taxable profit.
Until the time when the company starts its sales, there is a dependence on contributions from the shareholders or other external investors in order to ensure continued operation. As of the closing date, the Group had a liquidity amounting to SEK 331,196,000, which is considered sufficient for the company's operations for the next 12 months. For the period thereafter, there are no binding obligations that ensure the company's financing.