Elecnor S A : Annual report 2022 of the Audit Commitee

ANNUAL REPORT 2022

AUDIT COMMITTEE

1. Introduction

The Audit Committee of Elecnor, S.A. (the "Company") has prepared this report, in full accordance with the applicable laws and regulations and the recommendations of the Good Governance Code of Listed Companies ("GGC"), including also the information required by CNMV Technical Guide 3/2017 on Audit Committees.

The responsibilities, composition and operating rules of the Audit Committee of the Company, as standing supervisory committee advising the Board of Directors, are basically regulated in article 15 bis of the Company Bylaws and article 13 del Regulations of the Board of Directors, as well as in the Regulations of the Audit Committee itself, which are continuously adapted in line with the relevant legal modifications and recommendations on corporate governance matters.

In compliance with Recommendation 6 of the GGC, this report will be available to shareholders, investors and other interested parties on the Company website (www.grupoelecnor.com) as from the call of the next ordinary Annual General Shareholders' Meeting.

1. Composition of the Audit Committee

Due to their reappointment as directors of the Company by resolution adopted by the General Shareholders' Meeting held on 18 May 2022, Ms. Irene Hernández Álvarez, Mr. Miguel Morenés Gilés and Mr. Ignacio Prado Rey-Baltar were re-elected as members of the Audit Committee by virtue of the resolution of the Board of Directors entered into that same day. The first two also maintain their respective positions as President and Secretary of the Committee.

Likewise, and by resolution of the Board of Directors held on 18 May 2022 after her appointment as director by the Shareholders' Meeting held on the same day, Ms. Francisca Ortega Hernández-Agero was appointed member of the Audit Committee. At this meeting of the Board of Directors, the voluntary resignation as a member of the Audit Committee of Mr. Emilio Ybarra Aznar was also accepted, whom the Committee and the Board thanked for all the services rendered, fully approving and without any exceptions his management.

In accordance with the foregoing, since 18 May 2022 the Audit Committee has been composed of the following members:

Page 1 of 10

	Director		Position	Category	Appointment
Ms. Irene Hernández Álvarez	Chairman	Independent	2018
Mr. Miguel Morenés Giles		Member	Proprietary	2003
Ms. Isabel Dutilh Carvajal		Member	Independent	2015
Mr. Ignacio Prado Rey-Baltar	Member	Proprietary	2018
Ms.	Francisca	Ortega	Member	Independent	2022
Hernández-Agero

Currently, the Audit Committee is made up of five (5) non-executive directors, with the majority of its members being independent, thus complying with the provisions of the CBG regarding independence and diversity of professional and gender profiles. in the composition of the Audit Committee.

The Company's website contains more detailed information on the members of the Committee and their professional backgrounds.

1. Meetings of the Audit Committee

In 2022 the Committee held 11 meetings, with 100% attendance:

Review of

Relation

financial

Monitoring

with

Supervisio

and non-

risks and

external

n of

financial

Other

internal

auditor,

complianc

information

audit

independen

e systems

and

ce and fees

objectives

25 January

✓

✓

✓ (a) (b)

22 February

✓

✓

✓ (d)

29 March

✓

✓

✓

✓

26 April

✓

✓ (e)

18 May

✓ (c)

28 June

✓

✓ (d)

26 July

✓

✓

✓

27 September

✓

✓

✓

✓ (d)

25 October

✓

✓ (e)

Page 2 of 10

29 November							✓	✓		✓ (f)
20 December		✓			✓					✓ (g)

1. Analysis of issues arising from the assessment of the Audit Committee by the Board of Directors and determination of proposals for action.
2. Approval of the Audit Committee's Annual Report for 2021.
3. Appointment of the Chairman and Secretary of the Audit Committee.
4. Monitoring the corporate tax policy, the main tax risks and the procedures for managing and controlling those risks.
5. Monitoring the risk management system and the corporate Risk Map.
6. Oversight of the Digital Transformation Project and of the management of IT systems security.
7. Annual supervision of corporate policies and internal codes of conduct.

During 2022 Committee meetings were attended by various persons from the Company or its Group and outside professionals according to the matters dealt with at the meetings, at the invitation of the Committee Chair and in relation to the specific points on the agenda for which they were invited to attend:

• Members of the General Internal Audit and Finance Sub-Division (10 meetings).
• Head of Internal Audit (10 meetings).
• Group Compliance Officer (5 meetings).
• General Secretary (4 meetings).
• Head of IT and Technology Area (part of the Corporate Development Department) (1 meeting).
• Head of External Communications and Corporate Image (3 meetings).
• External auditors (KPMG) (3 meetings).

IV. Activities of the Audit Committee

The Audit Committee's activity in 2022 was primarily focused on the following matters related to the powers attributed by article 5 of the Regulations of said Committee:

1. Reviewing the periodic financial and non-financial information disclosed to the markets and the objectives and projections at year-end.
2. Monitoring of the main risks with a potential impact on the income statement account and other significant issues affecting the annual accounts, the Risk Management System and Internal Audit activity.
3. Relations with the Group's external auditors, supervision of their independence and approval of fees.
4. Supervision of the compliance system and of the activity of the Compliance Committee.

Page 3 of 10

1. Follow-upof the Group's Digital Transformation Project and the management of the security in information systems.
2. Reporting to the General Shareholders' Meeting.
3. Overseeing compliance with the Company's corporate governance rules and internal codes of conduct. Evaluation by the Committee.

1. Reviewing the periodic financial and non-financialinformation disclosed to the markets and the objectives and projections at year-end

The Committee supervises the preparation and completeness of the financial and non- financial reporting of the Company and the consolidated group, reporting favourably to the Board, for subsequent filing with the authorities and disclosure to the market, as well submission of the Annual Accounts and Non-Financial Information Statement to the shareholders for approval at the General Meeting.

Prior to its submission to the Board of Directors, the Committee reviews the financial information (and where relevant the annual non-financial information) produced on a quarterly basis (March and September), half-yearly (June, subject to limited review by the Group's auditor) and yearly (December, subject to review by the Group's auditor) that is to be sent to the CNMV and disclosed to the markets (key financials, performance versus the previous period, performance of the main businesses and geographical areas, etc.).The annual non-financial reporting is also subject to independent verification by KPMG.

During the financial year, the General Internal Audit and Finance Sub-Division has provided the Audit Committee with the appropriate explanations regarding the accounts. The accounting treatments of extraordinary transactions and tax treatment of significant transactions have been analysed and discussed with the Group's auditors and/or advisers.

Throughout the year, reassessments of year-end objectives and forecasts are presented and any deviations from the objectives are explained.

2. Monitoring of the main risks with a potential impact on the profit and loss account and other significant issues affecting the annual accounts, the Risk Management System and Internal Audit activity

The Committee has continuously monitored the main risks with a potential impact on the income statement, which are structured by General Sub-Directors and Business Directorates and are quantified in terms of exposure for the Group, as well as the monitoring of contingent balances. with customers and debit balances with public bodies. Once the risks have been informed, the suitability of their possible accounting provision has been analysed on a case-by-case basis.

Page 4 of 10

The Audit Committee has also monitored the most significant judgments and estimates with impact on financial reporting, emphasising those related to signs of impairment of goodwill, intangible and tangible assets, deferred tax assets and the recognition, control and measurement of derivative financial instruments.

In the tax field, the Audit Committee has monitored the main risks and the effective application of the corporate Tax Policy and reviewed the tax treatment of operations with special significance. Specifically, in February of this year, the Committee reviewed the changes introduced in the Group's transfer pricing policy, expressing its agreement with them and which was communicated to the Board of Directors.

There have been no related-party transactions in 2022 that had to be reviewed by the Commission. However, the Committee has evaluated the application during the year 2022 of the Protocol of Related Party Transactions approved by the Board of Directors at its meeting of 15 December 2021, based on the report issued by the operating group established in compliance with the provisions of the aforementioned Protocol, endorsing its conclusions and estimating that the task force has satisfactorily carried out its functions in 2022 and that the provisions of the Protocol have been complied with..

Continuous monitoring of the main risks to which the Group is exposed (governance, strategic and environmental, operational, information and compliance) has been carried out by supervising the Risk Management System and the corporate Risk Map and, in particular, of the risks identified, of the evaluation of their potential impact, probability of their materialization and of the action plans defined to improve their management. In this financial year, the Commission has carried out special monitoring of the risks related to project management (offer phases, negotiation and closing of the contract and execution), the management of tax risks, occupational safety, especially in the area subcontractors, information systems (continuity and security), compliance and risks related to sustainability and climate change.

In 2022, the Commission has carried out special monitoring of the risks and impacts for the Group derived from the war in Ukraine, high energy prices and high inflation.

The Audit Committee has adequately supervised the Internal Audit function, approving its annual work plan and monitoring it and its monitoring and review activity of the main risks that affect the organization, its processes and controls. Likewise, the Audit Committee has received, reviewed and approved the corresponding activity annual report prepared by Internal Audit.

3. Relations with the Group's external auditors, supervision of their independence and approval of fees

The Audit Committee met with the Group's external auditors three times in 2022, without the presence of other members of the organisation at any of those meetings.

The main issues discussed with the external auditors were:

Page 5 of 10