Auditors’ Report on the Consolidated Financial Statements Auditors’ Report on the Consolidated Financial Statements REPORT OF THE STATUTORY AUDITOR TO THE GENERAL MEETING OF HILTI AKTIENGESELLSCHAFT, SCHAAN Report on the audit of the consolidated financial statements Opinion We have audited the consolidated financial statements of Hilti Aktiengesellschaft and its subsidiaries (the Group), which comprise the consolidated balance sheet, consolidated income statement, consolidated statement of comprehensive income, consolidated statement of changes in equity, consolidated cash flow statement and notes, including a summary of significant accounting policies (pages 10 to 74), and the consolidated management report (pages 6 to 7) for the year ended 31 December 2018. In our opinion, the consolidated financial statements give a true and fair view of the consolidated financial position of the Group as at 31 December 2018 and its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with the International Financial Reporting Standards (IFRS) and comply with Liechtenstein law. Basis for opinion We conducted our audit in accordance with Liechtenstein law and International Standards on Auditing (ISAs). Our responsibilities under those provisions and standards are further described in the “Auditor’s responsibilities for the audit of the consolidated financial statements” section of our report. We are independent of the Group in accordance with the provisions of Liechtenstein law and the requirements of the Liechtenstein audit profession, as well as the IESBA Code of Ethics for Professional Accountants, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Our audit approach • Overall Group materiality: CHF 33 million Materiality • We concluded full scope audit work at 20 reporting units in 19 countries. • Our audit scope addressed over 78% of the Group’s revenue and 75% of the Group’s total assets. Audit • In addition, specified procedures were performed on a further 3 reporting units in 3 scope countries, representing a further 3% of the Group’s revenue and 4% of the Group’s total assets. • Further, we performed additional procedures to address any residual risk at other Key audit locations as deemed appropriate. matters As key audit matter the following area of focus has been identified: • Capitalization of internal development costs Materiality The scope of our audit was influenced by our application of materiality. Our audit opinion aims to provide reasonable assurance that the consolidated financial statements are free from material mis-statement. Misstatements may arise due to fraud or error. They are considered material if individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the consolidated financial statements. Based on our professional judgement, we determined certain quantitative thresholds for materiality, including the overall Group materiality for the consolidated financial statements as a whole as set out in the table below. These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures and to evaluate the effect of mis-statements, both individually and in aggregate on the consolidated financial statements as a whole. Overall Group materiality CHF 33 million How we determined it 5% of profit before tax 2018 Financial Report | 75