Talvivaaran Kaivososakeyhtiö Oyj - Inside information

Talvivaara's Auditor's Report for the period 1 January - 30 June 2017

Stock Exchange Release
Talvivaara Mining Company Plc
14 September 2017



     Talvivaara's Auditor's Report for the period 1 January - 30 June 2017


The  Auditor's report for  the period 1 January  - 30 June 2017 to  the Board of
Directors of Talvivaara Mining Company Plc is the following:

The  following  document  is  an  English  translation  of the Finnish auditor's
report.

Auditor's Report

To the Board of Directors of Talvivaara Mining Company Plc

Report on the Audit of the Interim Financial Statements

Opinion
In our opinion

   ·         the consolidated interim financial statements give a true and fair
view of the group's financial position and financial performance and cash flows
in accordance with International Financial Reporting Standards (IFRS) as adopted
by the EU

   ·         the interim financial statements give a true and fair view of the
parent company's financial performance and financial position in accordance with
the laws and regulations governing the preparation of the financial statements
in Finland and comply with statutory requirements.

What we have audited
We have audited the interim financial statements of Talvivaara Mining Company
Plc (business identity code 1847894-2) for the period 1 January - 30 June 2017.
The interim financial statements comprise:

   ·         the consolidated balance sheet, income statement, statement of
changes in equity, statement of cash flows and notes, including a summary of
significant accounting policies

   ·         the parent company's balance sheet, income statement, statement of
changes in equity, statement of cash flows and notes.

Basis for Opinion
We conducted our audit in accordance with good auditing practice in Finland. Our
responsibilities under good auditing practice are further described in the
Auditor's Responsibilities for the Audit of the Interim Financial Statements
section of our report.

We  believe  that  the  audit  evidence  we  have  obtained  is  sufficient  and
appropriate to provide a basis for our opinion.

Independence
We are independent of the parent company and of the group companies in
accordance with the ethical requirements that are applicable in Finland and are
relevant to our audit, and we have fulfilled our other ethical responsibilities
in accordance with these requirements.
Emphasis of Matter
We draw attention to note 2 in the interim financial statements, which describes
the basis of preparation of the interim financial statements on a non-going
concern basis, as well as the uncertainties relating to the Company's ability to
revise its reporting basis and to regain its status as a going concern and to
section "Statement of changes in equity" which describes changes in the
Company's equity during the review period and the amount of the equity as at 30
June 2017. Our opinion is not qualified in respect of this matter.

Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of
most significance in our audit of the interim financial statements of the review
period. These matters were addressed in the context of our audit of the interim
financial statements as a whole, and in forming our opinion thereon, and we do
not provide a separate opinion on these matters.

As in all of our audits, we also addressed the risk of management override of
internal controls, including among other matters consideration of whether there
was evidence of bias that represented a risk of material misstatement due to
fraud.

Key audit matter in the audit of the group and                 How our audit
addressed the key audit matter
the parent company
Cash flow forecasting process
Refer to the balance sheet and statement of cash flows
                                                                              We
reviewed management's cash flow forecasting
As at 30 June 2017, the group's cash and
cash                                       process and tested the key
assumptions as follows:
equivalents amounted to € 1,6 million. The parent              * We made
inquiries with management on their
company does not currently have any income
                       intention of funding and financing new businesses.
generating business and is financing its operations            * We analysed
management's monthly cash flow
from its cash reserves. If the necessary cash flow is           forecasts and
compared them with the actuals.
not secured, the parent company may have to file for        * We tested
mathematical accuracy of the monthly
bankruptcy.                                        cash flow forecasts.
Our audit procedures focused on the cash flow
forecasting process, as accurate and timely cash
forecasts are vital to the group's future.


Responsibilities of the Board of Directors and the Managing Director for the
Interim
Financial Statements
The Board of Directors and the Managing Director are responsible for the
preparation of interim consolidated financial statements that give a true and
fair view in accordance with International Financial Reporting Standards (IFRS)
as adopted by the EU, and of interim financial statements that give a true and
fair view in accordance with the laws and regulations governing the preparation
of interim financial statements in Finland and comply with statutory
requirements. The Board of Directors and the Managing Director are also
responsible for such internal control as they determine is necessary to enable
the preparation of interim financial statements that are free from material
misstatement, whether due to fraud or error.

In  preparing the interim  financial statements, the  Board of Directors and the
Managing  Director are  responsible for  assessing the  parent company's and the
group's ability to continue as going concern, disclosing, as applicable, matters
relating  to going concern and using the  going concern basis of accounting. The
interim  financial  statements  are  prepared  using  the going concern basis of
accounting  unless there is an intention to  liquidate the parent company or the
group  or cease operations, or  there is no realistic  alternative but to do so.
When the interim financial statements are not prepared on a going concern basis,
that  fact shall be disclosed in the interim financial statements, together with
the  basis on which the interim financial  statements have been prepared and the
reason why the entity is not regarded as going concern.

Auditor's Responsibilities for the Audit of the Interim Financial Statements
Our  objectives are  to obtain  reasonable assurance  about whether  the interim
financial statements as a whole are free from material misstatement, whether due
to  fraud or error, and to issue  an auditor's report that includes our opinion.
Reasonable  assurance is a high level of  assurance, but is not a guarantee that
an  audit conducted in accordance with good auditing practice will always detect
a  material misstatement when  it exists. Misstatements  can arise from fraud or
error  and are  considered material  if, individually  or in the aggregate, they
could  reasonably be expected to influence the economic decisions of users taken
on the basis of these interim financial statements.

As  part of  an audit  in accordance  with good  auditing practice,  we exercise
professional judgment and maintain professional skepticism throughout the audit.
We also:

  * Identify and assess the risks of material misstatement of the interim
    financial statements, whether due to fraud or error, design and perform
    audit procedures responsive to those risks, and obtain audit evidence that
    is sufficient and appropriate to provide a basis for our opinion. The risk
    of not detecting a material misstatement resulting from fraud is higher than
    for one resulting from error, as fraud may involve collusion, forgery,
    intentional omissions, misrepresentations, or the override of internal
    control.

  * Obtain an understanding of internal control relevant to the audit in order
    to design audit procedures that are appropriate in the circumstances, but
    not for the purpose of expressing an opinion on the effectiveness of the
    parent company's or the group's internal control.

  * Evaluate the appropriateness of accounting policies used and the
    reasonableness of accounting estimates and related disclosures made by
    management.

  * Conclude on the appropriateness of the Board of Directors' and the Managing
    Director's use of the basis of accounting on which the interim financial
    statements have been prepared.

  * Evaluate the overall presentation, structure and content of the interim
    financial statements, including the disclosures, and whether the interim
    financial statements represent the underlying transactions and events so
    that the interim financial statements give a true and fair view.

  * Obtain sufficient appropriate audit evidence regarding the interim financial
    information of the entities or business activities within the group to
    express an opinion on the interim consolidated financial statements. We are
    responsible for the direction, supervision and performance of the group
    audit. We remain solely responsible for our audit opinion.


We  communicate  with  those  charged  with  governance  regarding,  among other
matters,  the  planned  scope  and  timing  of  the  audit and significant audit
findings,  including any  significant deficiencies  in internal  control that we
identify during our audit.

We  also provide  those charged  with governance  with a  statement that we have
complied  with  relevant  ethical  requirements  regarding  independence, and to
communicate with them all relationships and other matters that may reasonably be
thought to bear on our independence, and where applicable, related safeguards.

From  the matters communicated with those  charged with governance, we determine
those  matters that  were of  most significance  in the  audit of  the financial
statements  of the current  period and are  therefore the key  audit matters. We
describe  these  matters  in  our  auditor's  report  unless  law  or regulation
precludes  public  disclosure  about  the  matter  or  when,  in  extremely rare
circumstances,  we determine  that a  matter should  not be  communicated in our
report because the adverse consequences of doing so would reasonably be expected
to outweigh the public interest benefits of such communication.

Other Reporting Requirements

Other Information
The Board of Directors and the Managing Director are responsible for the other
information. The other information comprises information included in the report
of the Board of Directors.

Our opinion on the interim financial statements does not cover the other
information.

In connection with our audit of the interim financial statements, our
responsibility is to read the information included in the report of the Board of
Directors and, in doing so, consider whether the information included in the
report of the Board of Directors is materially inconsistent with the interim
financial statements or our knowledge obtained in the audit, or otherwise
appears to be materially misstated. Our responsibility also includes considering
whether the report of the Board of Directors has been prepared in accordance
with the applicable laws and regulations.

In our opinion, the information in the report of the Board of Directors is
consistent with the information in the interim financial statements and the
report of the Board of Directors has been prepared in accordance with the
applicable laws and regulations.

If, based on the work we have performed, we conclude that there is a material
misstatement of the information included in the report of the Board of
Directors, we are required to report that fact. We have nothing to report in
this regard.

Other Matter
We also draw attention to the disclosure "Risk management and key risks" in the
report of the Board of Directors, which describes the Company's near term risk
factors that relate to the continuance of the business operations and to
disclosure "Events after the review period" which states that the group's cash
and cash equivalents amount approximately euro 1 million as at 14 September
2017.

Helsinki 14 September 2017

PricewaterhouseCoopers Oy
Authorised Public Accountants



Juha Wahlroos
Authorised Public Accountant (KHT)



Enquiries
Talvivaara Mining Company Plc Tel +358 20 712 9800
Pekka Perä, CEO
Pekka Erkinheimo, Deputy CEO


[]

Attachments:

Talvivaara Auditors Report H1 2017.pdf